Last night, President Donald Trump called on Truth Social for the U.S. military budget to increase to $1.5 trillion in 2027, citing "very troubled and dangerous times." As a result, defense stocks are higher today, after a rough day across the board on Wednesday in response to comments from Trump noting he would not allow defense companies to issue dividends and stock buybacks.
Northrop Grumman Corp (NYSE:NOC) was last seen up 8.1% to trade at $623.21, pacing for its best day since July. The equity earlier came within striking distance of its Oct. 9, record high of $640.90, and is up nearly 36% in the last 12 months.
General Dynamics Corp (NYSE:GD) shares are up 5% to trade at $363.06, earlier nabbing an all-time high of $367.66 right out of the gate. GD is also on on track for its best day since July and sports a 39.8% year-over-year lead, with support stemming from the $340 level.
Options traders are targeting both equities today, with NOC and GD attracting 14 and four times the intraday average volume, respectively. The most active contract for the former is the January 16, 2026 630-strike put -- where positions are being sold to open -- while the latter is seeing most activity at the March 360 call.
