US Flies B-1B Bomber Over Korean Peninsula: What It Means For Defense Companies, ETFs

The U.S. flew a B-1B bomber over the Korean Peninsula Wednesday morning. Amid greater escalation of tension in the region between North Korea and South Korea, how does it affect defense companies and exchange-traded funds (ETFs)?

What Happened: The South Korean military announced the bombing drill, according to the Associated Press.

During the training drill, the B-1B bomber dropped Joint Direct Attack Munitions (JDAMs) while being escorted by South Korean jets.

Why it Matters: Both the B-1B bomber and JDAMs are manufactured by Boeing Co BA.

Other U.S. weapons manufacturers actively supply the South Korean military. Rtx Corp RTX, formerly Raytheon, supplies aerospace engines and radar technology to South Korea. Northrop Grumman Corp NOC supplies South Korea with mine detection radar technology.

The U.S. has recently spent billions on military operations in Ukraine, Israel and Taiwan. Escalation in the Korean Peninsula could also draw the attention of U.S. legislators.

There are many defense-themed ETFs that are heavily weighted towards the defense contractors mentioned above, including the iShares US Aerospace & Defense ETF ITA, the iShares U.S. Aerospace & Defense Index ETF XAD and the Invesco Aerospace & Defense ETF PPA.

Price Action:

• Boeing traded at $189.65, up 0.55%.
• RTX traded at $108.42, up 0.48%.
• Northrop Grumman traded at $442.74, down 1.26%.

Also Read: Kim Jong Un’s Minister Says North Korea Won’t Be Sending Manure-Filled Balloons Anymore But Warns Resumption If South Korea Allows Anti-Pyongyang Leaflets

Image: B-1B Lancers from Military_Material (Pixabay)