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Weapons and wealth: Market reaction to Europe’s defense push

Author

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  • Comincioli, Nicola
  • Donadelli, Michael
  • Rizzati, Massimiliano

Abstract

This paper analyzes abnormal returns around the EU’s Readiness 2030 defense initiative. Defense stocks saw strong positive returns, especially pre-announcement, while high-tech firms showed weak or negative returns—indicating no spillover effect to the tech sector and underscoring the role of industry classification in market reactions.

Suggested Citation

  • Comincioli, Nicola & Donadelli, Michael & Rizzati, Massimiliano, 2025. "Weapons and wealth: Market reaction to Europe’s defense push," Economics Letters, Elsevier, vol. 255(C).
    • Handle: RePEc:eee:ecolet:v:255:y:2025:i:c:s0165176525003751
    DOI: 10.1016/j.econlet.2025.112538
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    JEL classification:

    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
    • H56 - Public Economics - - National Government Expenditures and Related Policies - - - National Security and War
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy

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