Trump Orders Pentagon To Restart Nuclear Tests After Over 30 Years ‘On Equal Basis’ With Rivals: Watch These Defense Stocks
Moscow reportedly tested an atomic-powered torpedo drone, which can carry nuclear weapons, on Wednesday.
- The Republican President’s comments come amid a rise in Russia’s tests of so-called nuclear-capable super weapons in recent weeks.
- Defense firms such as RTX, General Dynamics, Northrup Grumman, Boeing, and Lockheed Martin stand to benefit from increased spending.
- “Because of other countries’ testing programs, I have instructed the Department of War to start testing our Nuclear Weapons on an equal basis.” — Trump.
Defense stocks were in focus after President Donald Trump said on Wednesday that the U.S. will begin testing nuclear weapons, citing recent tests carried out by rivals.
“Because of other countries’ testing programs, I have instructed the Department of War to start testing our Nuclear Weapons on an equal basis. That process will begin immediately,” Trump wrote on Truth Social.
The Republican President’s comments come amid a rise in Russia’s tests of so-called nuclear-capable super weapons in recent weeks, as per a Bloomberg News report. Moscow reportedly tested an atomic-powered torpedo drone, which can carry nuclear weapons, on Wednesday, days after carrying out launches of its long-distance cruise missile.
When Did The US And Russia Last Conduct Nuclear Tests?
The U.S. last tested a nuclear bomb way back in September 1992 in an underground facility in Nevada, before President George H.W. Bush paused such tests by issuing a moratorium. The reversal of the decades-old U.S. nuclear policy could once again start a global nuclear arms race.
Moscow’s last test was in 1990, before the fall of the Soviet Union. Both sides have since relied on testing intercontinental ballistic missiles with mock weapons and computer modeling to examine the weapons.
During Trump’s first term, the U.S. withdrew from a nuclear disarmament treaty with Russia, citing Moscow’s violation of the treaty through the production of banned missiles. He also mentioned China’s absence, a growing nuclear power, as one of the key drawbacks of the treaty.
According to a report by the Stockholm International Peace Research Institute (SIPRI) earlier this year, Beijing now holds at least 600 nuclear warheads, with the Chinese military adding nearly 100 warheads per year on average since 2023.
Which Companies Could Benefit?
While Trump did not clarify whether the U.S. would carry out nuclear explosions or it would test nuclear-capable missiles, an increase in testing would likely see more contracts for aerospace and defense players in the U.S.
Last year, Northrop Grumman secured a $3.5 billion contract from the U.S. Navy to create the mission systems integrator for the Navy’s new generation of aircraft, designed for emergency command of nuclear-armed forces. In 2015, the company nabbed the contract to develop the stealthy B-21 bomber, before getting another contract in 2019 to create a successor to the Minuteman III ICBM, which has been in service since the 1970s.
Lockheed Martin also holds a contract to build the re-entry vehicle for the upcoming Sentinel ICBMs, as well as a $383 million contract to modernize the Trident II D5 nuclear missile. Another defense firm, RTX, is developing the engines for the B-21 bomber through its Pratt & Whitney unit, as well as a Long Range Standoff stealthy cruise missile.
Boeing was awarded a $2.8 billion contract for the Evolved Strategic Satellite Communications (ESS) program to provide space-based nuclear, command, control, and communications services to the U.S. nuclear command. Boeing also provides support to the guidance subsystem of the Minuteman missiles. Another firm, General Dynamics, is building a dozen nuclear-capable submarines that will carry the bulk of the nuclear warheads.
Retail sentiment on Stocktwits about Lockheed Martin, Northrup Grumman, and RTX was in the ‘bearish’ territory at the time of writing, while traders were ‘bullish’ about Boeing.
RTX stock has gained 50.8% this year, while Northrup stock and General Dynamics shares are up 24% and 30%, respectively, all outperforming the benchmark S&P 500 and Nasdaq indices. Boeing shares have risen nearly 20% but Lockheed stock has fallen 0.1% after concerns over its F-35 program.
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