Lates News

European defense stocks fell as a sweeping Democratic victory in the U.S. midterm elections weakened market expectations for further increases in U.S. military spending. The Goldman Sachs European defense basket index fell as much as 4.1% on Wednesday, its biggest drop in more than four months. Shares of British defense company BAE Systems fell as much as 5.9%; nearly half of the company's revenue comes from the U.S. market. Analyst Jens-Peter Rieck of MWB Research said in emailed comments that the election result also removed a factor that had previously driven European defense stocks higher in 2025, namely market concerns about "the United States withdrawing from European defense affairs." However, Alessandro Pozzi, an analyst at Mediobanca, believes that given that polls and prediction markets had for weeks been pointing to a comprehensive Democratic victory, the European market's reaction to the election result was somewhat unexpected.