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Short-Term market impact of 2024 US President elections and Trump-Zelensky meeting in defence industry

Author

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  • Martins, António Miguel
  • Albuquerque, Bruno
  • Sardinha, Luís
  • Moutinho, Nuno

Abstract

This study examines the short-term market effect of the US and European largest defence firms on the 2024 US presidential election (November 5, 2024) and the Trump-Zelensky meeting (February 28, 2025). By employing an event study methodology, our results show a positive and statistically significant stock price impact for both events. The results for the 2024 US presidential election are consistent with political business cycle theory. National elections in the arms-producing country drive a growth in sales revenues for defence firms, which tend to be higher when the Republican Party candidate wins the US elections. Our results also show the presence of heterogeneous abnormal returns between US and European defence firms around the Trump-Zelensky meeting, with European firms showing high and statistically significant positive returns while US firms show non-significant returns. This result is explained by the failure of security guarantees given by the US to the European countries and the awareness of the need for a rapid increase in military spending for self-defence purposes in Europe. This meeting reinforced the application of the principle of “Europe preference” in the acquisition of weapons. Finally, we conclude that stock market responses are reinforced or mitigated by firm-specific characteristics.

Suggested Citation

  • Martins, António Miguel & Albuquerque, Bruno & Sardinha, Luís & Moutinho, Nuno, 2026. "Short-Term market impact of 2024 US President elections and Trump-Zelensky meeting in defence industry," The North American Journal of Economics and Finance, Elsevier, vol. 82(C).
    • Handle: RePEc:eee:ecofin:v:82:y:2026:i:c:s1062940825002098
    DOI: 10.1016/j.najef.2025.102569
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    JEL classification:

    • G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates
    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading

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