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Defense stocks rally shock: group beats the market by 8.8%!

Industry · Oct 22, 2026 · 3 min read · Updated Nov 5, 2026

TL;DR

Defense stocks beat the market by 8.8% over the last 20 trading sessions. The gains were not shared evenly.

Defense had a loud month while the market drifted down

Lockheed Martin reported third-quarter results on 22 October, and the whole defense group moved in the same week. Over the last 20 trading sessions the equal-weight basket of 4 defense names returned 7.4%. The market benchmark returned -1.5% over the same 20 sessions. The gap between them is 8.8%.

Defense basket against the market
Both lines end below where they started. Over the last 20 trading sessions the equal-weight basket of 4 defense names returned 7.4%.
Data table
dateseriesvalueseries_role
2026-08-10Industry basket0.0%target
2026-08-11Industry basket-0.6%target
2026-08-12Industry basket-0.1%target
2026-08-13Industry basket-0.9%target
2026-08-14Industry basket0.5%target
2026-08-17Industry basket-1.2%target
2026-08-18Industry basket0.7%target
2026-08-19Industry basket-0.9%target
2026-08-20Industry basket-3.8%target
2026-08-21Industry basket-5.0%target
2026-08-24Industry basket-5.2%target
2026-08-25Industry basket-6.2%target
2026-08-26Industry basket-4.9%target
2026-08-27Industry basket-5.2%target
2026-08-28Industry basket-5.4%target
2026-08-31Industry basket-6.6%target
2026-09-01Industry basket-7.8%target
2026-09-02Industry basket-9.6%target
2026-09-03Industry basket-9.1%target
2026-09-04Industry basket-10.6%target
2026-09-08Industry basket-10.3%target
2026-09-09Industry basket-11.3%target
2026-09-10Industry basket-10.8%target
2026-09-11Industry basket-11.0%target
2026-09-14Industry basket-10.6%target
2026-09-15Industry basket-10.1%target
2026-09-16Industry basket-9.8%target
2026-09-17Industry basket-10.7%target
2026-09-18Industry basket-10.8%target
2026-09-21Industry basket-10.7%target
2026-09-22Industry basket-13.0%target
2026-09-23Industry basket-12.6%target
2026-09-24Industry basket-13.7%target
2026-09-25Industry basket-13.7%target
2026-09-28Industry basket-14.3%target
2026-09-29Industry basket-14.8%target
2026-09-30Industry basket-16.0%target
2026-10-01Industry basket-16.3%target
2026-10-02Industry basket-16.6%target
2026-10-05Industry basket-16.6%target
2026-10-06Industry basket-16.3%target
2026-10-07Industry basket-17.8%target
2026-10-08Industry basket-16.3%target
2026-10-09Industry basket-16.0%target
2026-10-12Industry basket-15.4%target
2026-10-13Industry basket-16.5%target
2026-10-14Industry basket-14.6%target
2026-10-15Industry basket-13.8%target
2026-10-16Industry basket-10.8%target
2026-10-19Industry basket-11.8%target
2026-10-20Industry basket-10.4%target
2026-10-21Industry basket-10.2%target
2026-10-22Industry basket-7.3%target
2026-10-23Industry basket-7.3%target
2026-08-10Market benchmark0.0%benchmark
2026-08-11Market benchmark-0.3%benchmark
2026-08-12Market benchmark-0.1%benchmark
2026-08-13Market benchmark0.6%benchmark
2026-08-14Market benchmark0.4%benchmark
2026-08-17Market benchmark-0.0%benchmark
2026-08-18Market benchmark-0.7%benchmark
2026-08-19Market benchmark-0.5%benchmark
2026-08-20Market benchmark-1.3%benchmark
2026-08-21Market benchmark-0.9%benchmark
2026-08-24Market benchmark-1.2%benchmark
2026-08-25Market benchmark-0.9%benchmark
2026-08-26Market benchmark-0.9%benchmark
2026-08-27Market benchmark-0.3%benchmark
2026-08-28Market benchmark-0.5%benchmark
2026-08-31Market benchmark-0.8%benchmark
2026-09-01Market benchmark-1.5%benchmark
2026-09-02Market benchmark-1.0%benchmark
2026-09-03Market benchmark0.0%benchmark
2026-09-04Market benchmark-0.4%benchmark
2026-09-08Market benchmark-0.9%benchmark
2026-09-09Market benchmark-1.4%benchmark
2026-09-10Market benchmark-2.0%benchmark
2026-09-11Market benchmark-1.1%benchmark
2026-09-14Market benchmark-1.6%benchmark
2026-09-15Market benchmark-2.0%benchmark
2026-09-16Market benchmark-2.5%benchmark
2026-09-17Market benchmark-1.3%benchmark
2026-09-18Market benchmark-1.2%benchmark
2026-09-21Market benchmark0.3%benchmark
2026-09-22Market benchmark0.3%benchmark
2026-09-23Market benchmark-0.4%benchmark
2026-09-24Market benchmark-0.5%benchmark
2026-09-25Market benchmark0.0%benchmark
2026-09-28Market benchmark-0.7%benchmark
2026-09-29Market benchmark-0.9%benchmark
2026-09-30Market benchmark-1.1%benchmark
2026-10-01Market benchmark-0.9%benchmark
2026-10-02Market benchmark-0.2%benchmark
2026-10-05Market benchmark0.5%benchmark
2026-10-06Market benchmark1.0%benchmark
2026-10-07Market benchmark0.8%benchmark
2026-10-08Market benchmark0.4%benchmark
2026-10-09Market benchmark1.0%benchmark
2026-10-12Market benchmark0.9%benchmark
2026-10-13Market benchmark0.9%benchmark
2026-10-14Market benchmark-0.2%benchmark
2026-10-15Market benchmark0.1%benchmark
2026-10-16Market benchmark-1.0%benchmark
2026-10-19Market benchmark-0.6%benchmark
2026-10-20Market benchmark-0.3%benchmark
2026-10-21Market benchmark0.3%benchmark
2026-10-22Market benchmark-0.9%benchmark
2026-10-23Market benchmark-1.4%benchmark

That is a wide gap for about one month of trading. Prices and news moved in the same window here, so read the chart as a picture of what happened together, not as proof of what caused what. The price data runs through 23 October 2026.

Zoom out and the group is still behind the market

Stretch the window and the picture changes. Over the longer 60-session window the same returned -2.3%, while the market returned 2.7%. So the group is still behind over roughly three months, even after a loud week.

Who led and who lagged
Lockheed Martin led with 5.9% over that longer window, and RTX trailed with -10.6%.
Data table
nameretseries_role
Lockheed Martin5.9%peer
Northrop Grumman3.6%peer
General Dynamics-8.2%peer
RTX-10.6%peer

The four members also went their own ways. Lockheed Martin led with 5.9% over that longer window, and RTX trailed with -10.6%. The typical spread between the members, measured as a , was 7.2%. Owning the whole industry and owning one name are not the same thing.

Glossary
basket
A made-up group of stocks treated as one holding. Equal weight means every member counts the same, no matter how big the company is.
standard deviation
A simple measure of how spread out a set of results is. A bigger number means the members behaved less alike.

Over the longer window, what was the return of the weakest of the four defense names?

Show answer

-10.6% RTX trailed with -10.6% over that longer window, while the leader was up. That is the surprise: the same industry, the same budgets, very different results.

Most of the pop after the news sat with one company

One more lens helps. The is the part of a stock's move that the market's own move does not explain. Across the 4 names measured, the median abnormal return from the day of the news was 3.5%. Lockheed Martin's was 11.1%, the largest of the group, and RTX's was 1.4%, the smallest.

One caution: fewer trading days have passed since the news than the measurement window asks for, so these figures are early. Everything here runs through 23 October 2026. My reading is that the group drifted up together while the company-specific part of the move stayed with Lockheed Martin.

Glossary
abnormal return
The slice of a stock's move left over once you strip out how the whole market moved that day. Analysts use it to see what is specific to one company.

Risks

  • An equal-weight basket of four names is not the whole defense industry.
  • A shared move can come from the whole market, not the industry itself.
  • One member can dominate a small basket and pull its average around.

Sources

  1. FinMind USStockPrice SPY — data as of 2026-10-23; fetched 2026-10-24 18:28 UTC; License note: FinMind open data; original source TWSE/TPEx or US exchanges
  2. FinMind USStockPrice GD — data as of 2026-10-23; fetched 2026-10-24 18:28 UTC; License note: FinMind open data; original source TWSE/TPEx or US exchanges
  3. FinMind USStockPrice LMT — data as of 2026-10-23; fetched 2026-10-24 18:28 UTC; License note: FinMind open data; original source TWSE/TPEx or US exchanges
  4. FinMind USStockPrice NOC — data as of 2026-10-23; fetched 2026-10-24 18:28 UTC; License note: FinMind open data; original source TWSE/TPEx or US exchanges
  5. FinMind USStockPrice RTX — data as of 2026-10-23; fetched 2026-10-24 18:28 UTC; License note: FinMind open data; original source TWSE/TPEx or US exchanges