Why RTX Corp Stock Is Sinking Today

Motley Fool
15 Feb
  • President Trump told reporters he intended to sit down with China and Russia to discuss cutting defense spending by half.
  • In the meantime, DOGE and Elon Musk are looking for more immediate ways to cut defense spending.

Shares of RTX Corp (RTX -2.73%) are trading lower on Friday. The company's stock lost 2.8% as of market close but lost as much as 3.5% earlier in the day. The drop comes as the S&P 500 lost 0.1%, and the Nasdaq composite gained 0.4%.

RTX, the defense giant formerly known as Raytheon, saw its stock impacted by comments made by President Trump on Thursday.

What Happened

President Trump, speaking from the White House on Thursday, told reporters that he would move to slash defense spending. The President said that he intended to meet with Russia and China in the future to reach an agreement to cut defense spending in half.

"When we straighten it all out, then one of the first meetings I want to have is with President Xi of China and President Putin of Russia, and I want to say let's cut our military budget in half. And we can do that, and I think we'll be able to do that," Trump said.

This comes as Department of Government Efficiency Chief, Elon Musk, turns his sights on the Pentagon. The defense department is currently preparing a report for Musk and his team, pre-emptively looking for ways to cut spending.

Why it matters

Roughly half of RTX's revenue comes from U.S. government defense spending. Any cuts would have an outsized impact on RTX, let alone 50% cuts. Although it's unclear that any significant cuts will actually happen, the possibility was enough to spook investors.

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

Most Discussed

  1. 1
     
     
     
     
  2. 2
     
     
     
     
  3. 3
     
     
     
     
  4. 4
     
     
     
     
  5. 5
     
     
     
     
  6. 6
     
     
     
     
  7. 7
     
     
     
     
  8. 8
     
     
     
     
  9. 9
     
     
     
     
  10. 10