BofA, Jupiter See Upside for Asia Defense Stocks on Arms Buildup

Asian defense stocks are attracting renewed investor interest following a global arms buildup sparked by the Iran war, with some investors seeing the sector as a longer-term growth story rather than a short-term geopolitical trade.

Three Asian stocks — South Korea’s Hanwha Systems Co. and LIG Defense & Aerospace Co., along with Japan’s Astroscale Holdings Inc. — rank among the top five defense performers worldwide this year, according to a Bloomberg gauge of aerospace and defense firms. The rally may be just the start of a longer expansion, as Middle East tensions highlight the growing indispensability of defense, according to investors, including BofA Securities and Jupiter Asset Management.