South Korean defense stocks surged on May 24, with Hanwha Aerospace breaking the 1 million won threshold for the first time, trading at 1,012,000 won (up 5.64%). The rally followed overnight gains in US defense stocks - Lockheed Martin rose 10.54%, RTX gained 7.33%, and Northrop Grumman advanced 1.56% - as escalating US-Iran military tensions drove investor interest in defense contractors. The movement came after President Donald Trump publicly discussed potential large-scale strikes on Iran and the Wall Street Journal reported on May 22 (local time) that the US military was deploying additional fighter jets, missiles, and medical personnel to the Middle East. Trump's warnings of imminent military action and ongoing US airstrikes against Iran for the 12th consecutive day heightened concerns of full-scale conflict, prompting investors to rotate into defense-related equities. The sentiment spillover from US markets to Korean defense stocks reflects growing global concerns about Middle East military escalation.
US Defense Stocks Rally Triggers Korean Market Response
At 9:30 AM on May 24, multiple South Korean defense contractors posted significant gains. LIG Nex1 rose 5.57% to 777,000 won, Hyundai Rotem advanced 1.98% to 169,800 won, and Poongsan climbed 2.61% to 66,900 won. The Wall Street Journal reported on May 22 (local time), citing multiple sources, that US special operations forces stationed at domestic bases moved to the Middle East within the past week, with fighter squadrons deployed across the region. The US positioned F-16 fighters from Germany's Spangdahlem base, F-35 fighters from the UK's Lakenheath base, and aerial refueling aircraft in the Middle East. These forces are observed as likely to be stationed in Jordan and Israel. The US military has continued airstrikes on Iran for the 12th consecutive day, targeting Iranian forces that claim control over the Strait of Hormuz and attack vessels. Iran has retaliated by striking US military bases in the Middle East, creating a pattern of punishment and retaliation.
Trump Signals Imminent Large-Scale Iran Strike
President Trump stated in an interview with Axios on May 24: "We are considering a large-scale attack" and "it will be bigger than any before." He added: "We are just before making a decision, and we have completed all preparations." Axios reported that Trump's remarks suggested the possibility of an attack larger than the "Mighty Wrath" operation conducted during previous full-scale conflict between the US and Iran, going beyond the current limited airstrikes. Trump warned that Iran will pay "many times over" whenever it kills US troops. He also warned he would strike Pickaxe Mountain, where Iran's underground nuclear facilities are suspected to be located, "very strongly soon." Regarding Israel's potential participation, Trump stated: "If requested, Israel will join the attack within two minutes," but added: "We do not need anyone's help."
FAQ
Why did Hanwha Aerospace break 1 million won on May 24?
Hanwha Aerospace rose 5.64% to 1,012,000 won on May 24 following a rally in US defense stocks, driven by escalating US-Iran military tensions. Lockheed Martin gained 10.54%, RTX rose 7.33%, and Northrop Grumman advanced 1.56% overnight as President Trump discussed potential large-scale strikes on Iran and the Wall Street Journal reported US military deployments to the Middle East on May 22 (local time).
What did President Trump say about potential Iran strikes?
In an Axios interview on May 24, Trump stated: "We are considering a large-scale attack" and "it will be bigger than any before." He added: "We are just before making a decision, and we have completed all preparations." Trump also warned he would strike Pickaxe Mountain, where Iran's underground nuclear facilities are suspected, "very strongly soon."
