Europe
The biggest single news from Europe is Saaba's contract with the Swedish agency FMV for 16 Gripen E fighters destined for Ukraine.
The contract value is about 24.6 billion SEK, and the order is to be booked in Q3 2026. Deliveries are planned for 2029–2030, and the package includes not only the aircraft but also spare parts and related equipment. The company's shares rise more than 3%.
After two waves of strong gains that lifted the price from about 165 SEK to about 750 SEK, the price made a sharp pullback and is now in a consolidation phase around 500 SEK. Staying above the lower bound of the resistance zone near 465 SEK could signal buyers looking to regain momentum and push the price at least above 600 SEK. A key observation remains the behavior of the 100/200 EMA, where there is a risk of the so‑called “Death Cross”. Source: xStation5
At the same time, Rheinmetall announced an order from Ukraine for artillery shells and rocket launchers. The contract value was described as “high tens of millions of euros”, and delivery is expected to finish in Q1 2027. Production has already started at the company's Spanish facilities. The group's shares gain more than 4%.
The defense sector also faces the upcoming IPO of KNDS. The producer of Leopard 2 tanks is set to debut on the Paris exchange within a few months. This will be an important sentiment test for investors in defense companies, or potential support.
In the broader European market context, remember that July is historically a growth period for European stocks. Source: Bloomberg Finance
USA
On the U.S. side, the most important is the package of contracts for Lockheed Martin worth over 3.1 billion USD. The largest portion of this amount is a 2.99 billion USD contract for the production of Sentinel A4 radars and engineering services. Work is expected to continue until June 2031.
Lockheed also received a contract related to the modernization of Spanish Álvaro de Bazán frigates. In pre‑market trading, the valuation does not seem to react to the news, which may indicate that investors have already discounted a similar contract.
Northrop Grumman received three contracts worth about 68 million USD in total. The largest, 49 million USD, concerns maintaining the Joint Tactical Ground Station program, including logistical support and engineering services. The company rises about 1% in pre‑market trading.
Boeing, however, received a 49.5 million USD contract for work related to controllers for air‑launched maneuvering missiles. The agreement covers test sets and the regeneration of controllers needed to maintain the ALCM system. The project is slated to finish in June 2033. This company also does not react in pre‑market trading, but the situation may change after the session opens.
From a capital market perspective, the key is the overall picture: the defense sector still benefits from a long cycle of military investment. In Europe, the main driver remains the war in Ukraine and NATO capability rebuilding, while in the United States there is continuity in funding radar, missile, and modernization programs – and recently, expectations for replenishing ammunition used in operations in Iran.
New contracts do not immediately change the overall performance picture of the largest firms in this sector, but they can strengthen market sentiment, which in terms of forecasts and valuation metrics may still undervalue the real growth potential of these companies.
The challenge for firms will still be not only maintaining the flow of orders but also quickly converting them into revenue, preserving margins – while increasing production capacity without excessive cost growth.
