President Donald Trump said the ceasefire with Iran might be over. That had defense stocks rising early Wednesday as most other shares fell.

"To me, I think it's over, I don't want to deal with them anymore," Trump told reporters at a NATO summit in Ankara on Wednesday, according to the Wall Street Journal. "They're liars, they're cheats, they're sick people," adding that U.S. negotiators are still talking.

The comments came after An exchange of strikes between American and Iranian forces overnight. U.S. Central Command said American forces hit more than 80 targets in a new round of strikes against Iran Tuesday.

International benchmark crude oil prices jumped about $2.50 per barrel, or 3%, following the remarks. S&P 500 and Dow Jones Industrial Average futures were off 0.9% and 1.1%, respectively.

Shares of defense contractors were up. Northrop Grumman and Lockheed Martin were rising 1.2% and 0.9%, respectively. General Dynamics shares gained 0.3%. L3Harris Technologies stock was flat.

Shares of small-capitalization drone technology companies weren't getting a big boost. AeroVironment stock was up 0.8%, but Kratos Defense & Security Solutions shares were down 0.4%. AEVEX and Red Cat shares were down less than 1%.

The Iran war wasn't a boon to the defense sector, despite using up munitions that will need to be replaced. The fighting actually ushered in what looks like a bear market. Coming into Wednesday trading, shares of Lockheed and Northrop were down 19% and 24%, respectively, since the fighting began.

Investors have worried that the unpopular war could help Democrats retake Congress in the midterm elections, which could put pressure on defense spending. The stock market is also forward-looking, and a lot of good news was reflected in sector shares. Coming into the war, the iShares Aerospace & Defense ETF was up about 60% over the prior 12 months.

What impact extended fighting in Iran will have on defense-sector stocks in the coming months is hard to say. Heightened geopolitical risk is typically a positive for the space, but too much risk isn't good for anyone.

Write to Al Root at allen.root@dowjones.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

July 08, 2026 07:58 ET (11:58 GMT)

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