Geopolitical Impact on Aerospace & Defense - Geopolitical unrest directly correlates with increased defense spending, leading to historic levels of global defense expenditure [7] - Ongoing conflict, such as the one involving the Israeli Air Force using F-35s, suggests continued robust demand in the aerospace and defense sector [3][13] - The situation suggests that peace is not expected in the near future, unfortunately driving defense spending [8] US Defense Budget and Spending - The House appropriators' FY26 bill is flat but includes a 45% year-over-year increase in investment spending, benefiting large-cap companies [6] - House Republicans are considering a reconciliation package that would allocate $150 billion in generational investment [7] - The Trump administration has discussed a $1 trillion defense budget, including both mandatory and discretionary spending [11] NATO and International Spending - A NATO summit is expected to discuss increasing equipment purchases to 35% of GDP [7] - If NATO were to increase spending to 5% of GDP, it could result in approximately $700 million in additional spending [11] US Foreign Military Sales - US foreign military sales are on pace for a third consecutive record year, indicating robust demand from US allies and partners [11] - Last year, foreign military sales reached $127 billion, following $18 billion the previous year [12]