The Saturday attack by Hamas on Israel proved to be a surprise, primarily due to the scale of the initial rocket attacks. In the market, we almost immediately observed an influx of capital into so-called "safe havens": the Swiss franc, the Japanese yen, and gold. Another "beneficiary" of the armed conflict in Israel and Palestine are defense companies, which, in uncertain times, benefit from the arms race and government contracts to replenish the arsenal and combat capabilities of individual armies.
It is the companies representing this economic sector that are recording the highest gains on Wall Street today. Shares of Northrop Grumman (NOC.US), a company producing the most modern bombers in stealth technology, are currently up nearly 11%. In contrast, shares of Lockheed Martin (LMT.US), the company that manufactures Black Hawk helicopters and F-35 Lightning II fighters, are up 8% intraday.
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Source: xStation 5
Cybersecurity Companies
In the face of escalating conflict, companies dealing with cybersecurity, including those listed in the USA but operating in Israel, have also been affected. After all, Israel is a pioneer of innovative solutions in the cybersecurity sector. BlueStar Israel Technology, the ETF that gathers tech companies from Israel, is losing more than 3.0% today, reflecting the war's impact on tech firms. Among the potentially affected companies is Palo Alto Networks (PANW.US), which has acquired several Israeli companies, such as Cider and Cyber Secdo. Nonetheless, the company initially recorded only a slight decrease of 0.3% at the beginning of the session. These losses were quickly reduced, and currently, Palo Alto Networks is gaining over 2.0%. It's likely that, besides the risk, investors have also started to value higher chances of rapid market growth due to escalating geopolitical tensions.
Source: xStation 5
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