Defense stocks surged Monday as military attacks escalated across the Middle East, with operations in the region underscoring that air and naval assets remain central to military strategy. The sector has rallied over the past year as global tensions intensified following the conflict between Russia and Ukraine, the US ouster of Venezuelan President Nicolás Maduro, and President Donald Trump’s threats about taking over Greenland.

Bloomberg Intelligence Senior Defense Analyst Wayne Sanders joined Bloomberg Businessweek Daily to discuss the sector’s momentum. He spoke with Carol Massar and Tim Stenovec about how the proposed US $1.5 trillion defense funding request is likely to benefit from the renewed focus on military preparedness. The analyst highlighted that the current geopolitical environment continues to drive investor interest in defense contractors.

Military operations in the Middle East have reinforced the strategic importance of air and naval capabilities, supporting the case for increased defense spending. The sector’s strong performance reflects growing concerns about global security threats and the need for enhanced military readiness. Investors are betting that sustained geopolitical tensions will translate into continued growth for defense companies.