NEW YORK (AP) — U.S. stock indexes are drifting at the start of Thursday’s trading, masking some big gains underneath the surface for makers of weapons and other military equipment after President Donald Trump said he wants to increase spending on them sharply
The S&P 500 slipped 0.2% in early trading, coming off its first loss in four days, though it remains near its all-time high set earlier this week. The Dow Jones Industrial Average was down 109
points, or 0.2%, as of 9:35 a.m. Eastern time, and the Nasdaq composite was 0.4% lower.
Yields ticked higher in the bond market following mixed data on the U.S. economy. The number of U.S. workers applying for unemployment benefits rose last week, an indication of increasing layoffs, but by no more than economists expected. Other reports, meanwhile, said U.S. workers improved their productivity by more in the summer than economists expected, while the U.S. trade deficit unexpectedly shrank in October.
On Wall Street, defense-industry companies jumped to some of the biggest gains after Trump said he wants to increase U.S. military spending to $1.5 trillion in 2027 from $901 billion in order to build the “Dream Military.”
Northrop Grumman soared 8.2%, Lockheed Martin climbed 8.8% and L3Harris Technologies jumped 8%. They more than made up their losses from the prior day, when Trump complained defense contractors were making military equipment too slowly.
RTX came under particular criticism by Trump, and its stock rose less than peers. It added 3.4% after Trump said that it was the “slowest in increasing their volume.”
Trump signed an executive order Wednesday calling on the Pentagon to ensure future contracts with contractors contain a provision prohibiting their ability to buy back their own stock during a period of underperformance on U.S. government contracts.
Elsewhere, oil prices jumped to continue their zigzags since Trump ousted the leader of Venezuela last weekend.
A barrel of benchmark U.S. crude climbed 2.1% to $57.18. Brent crude, the international standard, rose 2% to $61.14 per barrel.
Venezuela is potentially sitting on the largest oil deposits in the world, and any increase in production could push further downward on prices, which have already been falling on expectations for plentiful supplies. But it would also likely require billions of dollars of investment to get Venezuela’s aging infrastructure in good-enough shape to ramp up production sharply.
It’s not just Venezuela where the U.S. military could see action. Trump in recent days has also called for taking over the Danish territory of Greenland for national security reasons and has suggested he’s open to carrying out military operations in Colombia.
In stock markets abroad, indexes fell across much of Europe and Asia.
Japan’s Nikkei 225 dropped 1.6% for one of the world’s bigger moves, while Hong Kong’s Hang Seng fell 1.2%.
In the bond market, the yield on the 10-year Treasury rose to 4.18% from 4.15% late Wednesday.
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AP Business Writers Chan Ho-Him and Matt Ott contributed.
