From Morningstar: 2025-04-02 10:06:00

European retail investors are shaking up the market, rallying behind defense stocks like Hensoldt, Renk, Steyr Motors, and Eutelsat. Hedge funds shorted these stocks, but retail investors had other plans, resulting in significant price surges. Short selling can backfire, causing painful losses when stocks rise instead of fall.

Retail investors should be cautious of short-term hype and focus on fundamentals when evaluating defense stocks. While some European defense stocks remain attractive post-rally, uncertainty persists regarding national defense spending commitments. Despite political momentum, questions remain on allocation, sustained investment, and contractor benefits in the defense sector.

Steyr Motors, a Reddit favorite, saw its stock soar before crashing due to illiquidity and buying sprees. Regulators are monitoring price movements for signs of market manipulation. The company’s majority owner, Mutares, experienced increased buying interest after Germany’s defense spending announcement, prompting a slight increase in free float and subsequent stock fall. 1. The stock market reached new record highs today, with the S&P 500 closing at 4,500 points and the Dow Jones Industrial Average closing at 35,000 points. This marks a significant milestone for investors and signals confidence in the economy.

2. The latest job report showed a decrease in unemployment rates, with only 5.2% of the population currently unemployed. This is a positive sign of recovery from the pandemic-induced economic downturn, as more people are returning to work.

3. In other news, a new study revealed that 70% of Americans support stricter gun control measures, including universal background checks and bans on assault weapons. This reflects a growing concern about gun violence and a desire for legislative action to address the issue.

4. On the international front, tensions are rising between Russia and Ukraine, as Russian troops continue to amass near the border. The United States and European allies have expressed concern over the situation and are calling for a peaceful resolution to the conflict.

5. Lastly, the latest COVID-19 update reported a decrease in cases in some regions, but a rise in breakthrough infections among vaccinated individuals. Health officials are urging continued vigilance and adherence to safety measures to prevent further spread of the virus.



Read more at Morningstar: Why European Defense Shares Are Trading Like Meme…