The escalation of the US-Iran conflict triggers geopolitical tensions, Asian defense stocks rise

LootboxPhobia · 2026-03-02T07:29:23+00:00

Due to the escalation of the conflict between the United States and Iran, Asian defense stocks generally rose. Several defense companies in Japan and China saw stock price increases ranging from 0.1% to 6%, outperforming the overall market, reflecting how geopolitical tensions are driving military spending.

LootboxPhobia

2026-03-02 07:29:23

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Investing.com - Following the escalation of conflicts between the United States and Iran, which has raised ongoing geopolitical concerns in the Middle East, the stocks of Asian defense and heavy equipment manufacturers generally rose on Monday.

Japanese aircraft and missile manufacturers Mitsubishi Heavy Industries (TYO:7011), Kawasaki Heavy Industries (TYO:7012), and IHI Corporation (TYO:7013) increased between 0.1% and 4%.

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China State Shipbuilding Corporation (SS:600150) rose 0.5%, China Avic Shenyang Aircraft Company (SS:600760) and China Aero Engine Corporation (SS:600893) increased by 4% and 6%, respectively.

Australian shipbuilder Austal Ltd (ASX:ASB) surged 4%.

After the US and Israel launched attacks on Iran over the weekend, these defense stocks significantly outperformed the overall decline of Asian markets. Iran subsequently retaliated with attacks on Israel and several other Middle Eastern countries allied with the US.

U.S. President Donald Trump stated on Sunday night that Washington will continue attacking Iran until all “targets” are achieved.

Additionally, Ali Larijani, chairman of Iran’s Supreme National Security Council, said Iran would not negotiate with the US, dismissing media reports that Tehran had extended an olive branch to Washington.

Defense stocks often benefit from escalating geopolitical tensions, as increased military activity typically signals more military contracts.

Japanese defense contractors have seen particularly strong gains in recent months, especially after Tokyo announced plans to increase defense spending over the coming years.

This article was translated with the assistance of artificial intelligence. For more information, please see our Terms of Use.

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