According to CoinMeta, European defense stocks experienced their largest decline in over four months. The Democratic Party's decisive victory in the U.S. midterms weakened market expectations for further increases in U.S. military spending. The European defense stock index compiled by Goldman Sachs Group fell by 4.1% on Wednesday. The stock price of British defense company BAE Systems plummeted by 5.9%, with nearly half of the company's revenue coming from the U.S. market. Analysts Jens - Peter Rieck from Mediobanca stated that the election results eliminated a factor that had been driving up European defense stocks in 2025, namely market concerns about "the U.S. withdrawing from European defense affairs." Analyst Alessandro Pozzi believes that considering public opinion surveys and market forecasts that have indicated a Democratic Party win for weeks, the European market's reaction to the election results was somewhat unexpected.