FRANKFURT (dpa-AFX) - German defense stocks are expected to continue benefiting on Thursday from the persistently high international demand for defense. According to market participants, shares such as Rheinmetall, Hensoldt, Renk, and TKMS are receiving a boost in early trading from news that US President Donald Trump intends to significantly increase the military budget for 2027.
In Tradegate trading, the four German defense stocks were quoted between 0.6 and 3.5 percent higher compared to their Xetra closing prices. They had already gained ground during the previous day's session. Rheinmetall shares are now heading toward a new high since mid-October, up 1.5 percent on Tradegate. The biggest gains, however, are expected for Renk, up 3.5 percent.
In addition to the substantial investments planned in Germany, Trump is aiming for a dramatic increase in defense funding. On his platform Truth Social, he wrote that the military budget for 2027 should not be set at 1 trillion dollars, but rather at 1.5 trillion dollars. For the 2026 fiscal year, around 900 billion dollars is earmarked. Trump spoke of building a "dream military." At the same time, he wants to put pressure on US companies by initially banning dividend payouts and share buybacks.
Jefferies analyst Chloe Lemarie highlighted Thursday morning that Trump is planning a 50 percent increase in the US military budget for 2027 compared to the amount set for 2026. She believes that European companies will also benefit from this development. The expert specifically mentioned defense companies BAE Systems from the United Kingdom and Leonardo from Italy, both of which generate significant portions of their revenues in the US./tih/ck/zb
