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Jan 7, 2026 4:00 PM

Defense Stocks Sink After Trump Orders Contractors To Halt Dividends, Buybacks

Defense stocks fell sharply Wednesday after President Donald Trump ordered U.S. defense contractors to halt dividends and share buybacks, accusing the industry of underinvesting in production while paying executives too much.

The iShares U.S. Aerospace & Defense ETF (NYSE:ITA) fell more than 1%, snapping a three-session winning streak. The SPDR S&P Aerospace & Defense ETF Trust (NYSE:XAR) dropped about 0.9%.

Several major defense names slid hard in afternoon trading.

Redwire Corporation (NYSE:RDW) fell nearly 7%. Northrop Grumman Corporation (NYSE:NOC) dropped more than 4%. Lockheed Martin Corporation (NYSE:LMT) declined about 3.5%. VSE Corporation (NASDAQ:VSEC) lost roughly ...