Shares of defense stocks Rtx Corp ( RTX ) , Lockheed Martin Corp ( LMT ) and General Dynamics Corp ( GD ) climbed 4.6%, 4.2% and 1.2%, respectively, during Friday’s pre-market trading session amid Israel’s intensifying military operations in Lebanon and Iran.

What Happened: Israel recently initiated an invasion of Lebanon and executed leaders of Iran’s IRGC. This act provoked Iran to launch extensive strikes against targets within Israel. Lockheed Martin ( LMT ) , the largest arms manufacturer globally, produces the F-35 aircraft, which Israel employs in its regular bombardments of Gaza. 

RTX Corporation ( RTX ), formerly Raytheon, the second-largest arms manufacturer, provides Israel with “bunker buster” bombs, which are prohibited in densely populated areas.

Meanwhile, General Dynamics ( GD ) , another manufacturer of bunker busters, produces the BLU-109 bombs currently used by Israel.

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Why It Matters: The escalating tension in the Middle East has had a profound impact on global markets. Israel’s preemptive strike on Iran caused U.S. stock futures to slide, oil prices to jump 8%, and gold to surge above $3,400.

Moreover, the Trump administration has distanced itself from Israel’s recent military actions against Iran. These strikes are expected to complicate President Donald Trump's efforts to negotiate a nuclear deal with Tehran.

Lastly, President Trump’s ambitious $175 billion plan to develop a “Golden Dome” missile defense system announced in May is expected to usher in a new era for defense stocks like RTX, Lockheed Martin ( LMT ), and L3Harris ( LHX ) .

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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.