Expectations of war ending boost order outlook, South Korean defense stocks rise
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Glonghui, April 1st|On Wednesday, South Korean defense stocks outperformed the broader Asian stock indices as markets bet that, following the end of the Iran war, Middle Eastern clients will resume weapon orders. Gary Tan, a fund manager at Allspring Global Investments, stated: "Although the market expects the Iran conflict to ease, investors are positioning for long-term security and energy themes, leading to gains in defense stocks. The market seems skeptical about a rapid resolution of the conflict, so confidence in allocations to the defense and energy sectors remains strong." Bloomberg Intelligence analyst Eric Zhu noted: "If the United States withdraws troops from Iran, Gulf nations may need to shoulder more of their own defense burden, possibly including reopening the Strait of Hormuz. This could drive procurement demand in the region, from which South Korean defense systems are likely to benefit."
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