Closing Bell: Defense Shares Rally, Alphabet Rises, Rio Tinto Slides
Jan 8, 2026
Defense stocks soared after a proposal for a $1.5 trillion military budget, with major names like Lockheed Martin and Northrop Grumman seeing significant gains. Meanwhile, Alphabet overtook Apple to become the second-most valuable company, riding a wave of success in artificial intelligence. In contrast, Apple faced a slump, losing nearly $200 billion in market cap. Other topics included a rotation in the tech sector, impacting chip stocks as they experience a pullback, and Rio Tinto shares slid amid fresh merger talks with Glencore.
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question_answer ANECDOTE
Housing Stocks Swing After Presidential Remarks
The homebuilding index jumped over 4% after President Trump's earlier comment about banning institutional investors from buying single-family homes.
Carol Massar noted the group sold off the prior afternoon and then roared back as markets parsed the policy implications.
insights INSIGHT
Defense Stocks Rebound On Big Budget Plan
Defense stocks reversed losses after President Trump proposed a roughly 50% boost in the U.S. military budget to $1.5 trillion by 2027.
The budget proposal drove Lockheed, Northrop and General Dynamics higher and lifted European defense baskets too.
insights INSIGHT
Alphabet Surpasses Apple In Market Value
Alphabet overtook Apple to become the second-most valuable company by market cap as Google benefited from AI momentum.
Alphabet finished with a market capitalization above Apple after sustained gains and Apple's recent slump.
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Listen for comprehensive cross-platform coverage of the US market close as heard on Bloomberg Television, Bloomberg Radio, and YouTube with Romaine Bostick, Katie Greifeld, Carol Massar and Tim Stenovec.
- Shares of defense companies like Lockheed Martin (LMT), General Dynamics (GD) and Northrop (NOC) all rose in trading today on news from the White House that President Donald Trump said he wants to increase the country’s military budget by about 50% to $1.5 trillion in 2027. A Goldman Sachs basket of European defense stocks rose as much as 3.8% on Thursday, extending its gain for the week to about 13%. In the US, Northrop Grumman Corp. and Lockheed Martin Corp. surged more than 6% in premarket trading, rebounding from a drop the previous day when Trump called for curbs on executive pay and shareholder returns in the sector. Defense stocks also rose in Asia.
- Alphabet (GOOG) has overtaken Apple to become the second-most valuable company by market capitalization, a reflection of how the Google parent has emerged as one of the most significant winners of artificial intelligence. Shares of Alphabet rose 2.4% on Wednesday, closing with a valuation of $3.89 trillion. That allowed it to surpass Apple, which closed with a market cap of $3.85 trillion on Wednesday, following a six-day slump that erased nearly 5% — and almost $200 billion — off its value. The divergence widened further Thursday, with Apple opening 1.2% lower and Alphabet gaining 1.1%.
- Rio Tinto (RIO) saw its shares fall on word that Glencore said it’s in talks with the firm on a deal that would create the world’s biggest mining company, a little over a year after earlier talks between the two companies collapsed. Glencore said Thursday that it was in preliminary talks with Rio, with options including an all-share transaction that would see Rio buy Glencore. Glencore said there’s no certainty of a deal, adding that a further announcement will be made as appropriate. Rio Tinto declined to comment.
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