Companies Cash In On War Boom
Comrade M | 12.02.2002 18:25
Dow sagging? NASDAQ got you down? Buy war!
That’s the message from a survey of global defence stock markets compiled by Jane’s Defence Weekly. In JDW’s Feb. 13 issue, Business Editor David Mulholland writes that the magazine’s index of defence markets is now outperforming major stock markets in the USA and Europe.
The “JDW 20” was at 1,345 points at the end of last month, up from a baseline of 1,000 points at the beginning of 2000. That’s a return of more than 30% on your defence investment.
By contrast, most of the world’s stock markets took a beating in 2001, especially after 11 September. NASDAQ lost 25% last year, the Standard & Poor’s 500 was down 15%, and the UK FTSE dropped 16%.
Jane’s says the terror attacks on New York and Washington also hit the bottom lines of defence companies deep into the civil aviation business – firms like Boeing, BAE Systems and Rolls-Royce. But defence spending has also helped prop those stock prices up, and several other companies have benefited. Lockheed Martin shares are up 40% over last year, with three-quarters of the gain coming after 11 September. Gains were also posted by defence giant Raytheon.
The magazine points out that while the defence industry reflected the fortunes of other public firms before the terror attacks, since then the JDW 20 has moved in the opposite direction of the sagging multinationals. Jane’s partially attributes this to news that the Bush administration is requesting a substantial increase in military funding. Bush intends to boost the US defence budget to $379 billion – a level that’s $44 billion higher than the Cold War average.
That’s the message from a survey of global defence stock markets compiled by Jane’s Defence Weekly. In JDW’s Feb. 13 issue, Business Editor David Mulholland writes that the magazine’s index of defence markets is now outperforming major stock markets in the USA and Europe.
The “JDW 20” was at 1,345 points at the end of last month, up from a baseline of 1,000 points at the beginning of 2000. That’s a return of more than 30% on your defence investment.
By contrast, most of the world’s stock markets took a beating in 2001, especially after 11 September. NASDAQ lost 25% last year, the Standard & Poor’s 500 was down 15%, and the UK FTSE dropped 16%.
Jane’s says the terror attacks on New York and Washington also hit the bottom lines of defence companies deep into the civil aviation business – firms like Boeing, BAE Systems and Rolls-Royce. But defence spending has also helped prop those stock prices up, and several other companies have benefited. Lockheed Martin shares are up 40% over last year, with three-quarters of the gain coming after 11 September. Gains were also posted by defence giant Raytheon.
The magazine points out that while the defence industry reflected the fortunes of other public firms before the terror attacks, since then the JDW 20 has moved in the opposite direction of the sagging multinationals. Jane’s partially attributes this to news that the Bush administration is requesting a substantial increase in military funding. Bush intends to boost the US defence budget to $379 billion – a level that’s $44 billion higher than the Cold War average.
Comrade M
e-mail:
dailyshocker@hotmail.com