New York, January 8, 2026, 06:00 EST — Premarket
- Lockheed Martin shares rose about 7% in premarket trading, bucking softer index futures.
- Traders weighed a bigger U.S. military budget pitch against a White House push to curb buybacks and dividends at defense contractors.
- Focus turns to Friday’s U.S. jobs report and Lockheed’s January 29 earnings for clarity on cash returns and production plans.
Lockheed Martin shares jumped about 7% in premarket trading on Thursday after President Donald Trump called for a $1.5 trillion U.S. military budget for 2027, lifting defense contractors even as broader stock index futures edged lower ahead of key U.S. labor data. “A move toward more government intervention would create uncertainty,” said Mohit Kumar, an economist at Jefferies. 1
The bounce matters because Washington’s message to the sector has turned erratic in 24 hours: spend more, but hand less back to shareholders unless factories move faster. A White House fact sheet said Trump signed an executive order aimed at stopping defense contractors from prioritizing stock buybacks and “excessive corporate distributions” over production capacity and on-time delivery, and it directed officials to press for contract terms that can restrict payouts during periods of underperformance. 2
The stock had been hit in regular trading on Wednesday as investors digested the threat of limits on dividends and share repurchases. Lockheed fell 4.82% to close at $496.87, according to MarketWatch data. 3
Other prime contractors also advanced in early trading. Northrop Grumman rose more than 6% and RTX gained about 5%, even after Trump’s order sparked a rotation debate inside the sector, with Saxo Bank strategist Neil Wilson saying, “Geopolitics is the inescapable story of 2026 thus far.” 4
Lockheed has its own production narrative running alongside the politics. The company said on Tuesday it signed a framework agreement with the U.S. Department of War to accelerate PAC-3 Missile Segment Enhancement interceptor output, lifting annual capacity to about 2,000 from roughly 600 over a seven-year agreement. “We will create unprecedented capacity for PAC-3 MSE production,” Chairman and CEO Jim Taiclet said. 5
Even after Thursday’s premarket pop, the stock is coming off a sharp dip and remains well inside a wide recent range. Lockheed’s 52-week high is $538.73, according to MarketWatch. Buybacks, the policy target in the latest order, are when a company repurchases its own shares, which can boost earnings per share and often supports dividend-heavy stocks. 6
But there’s a catch for bulls: the executive order’s enforcement mechanics — and which contractors would be tagged as “underperforming” — remain the big unknown, and any budget push still runs through Congress. If rates jump on Friday’s jobs data, the sector’s rally could fade quickly.
