While defense stocks joined in on Tuesday’s broad market sell-off sparked by a hotter-than-expected reading on inflation, that’s after several sessions of gains that came as the U.S. Senate made progress on approving a $95 billion aid package for Ukraine, Israel and other allies.
Analysts at Height Capital Markets said they “expect Israel aid to pass, some Ukraine aid to pass, and some Taiwan aid to pass,” but questions remain about the timing of the House’s vote, as well as the exact levels of funding, possible conditions and potential budgetary offsets. House Speaker Mike Johnson, a Louisiana Republican, has criticized the package for lacking provisions for U.S. border security. Former President Donald Trump, the likely 2024 Republican presidential nominee, also has lobbied against the bill, saying in a social-media post that any aid to other countries should be done as a loan.