The terrifying week of defense stocks: This is the trigger that sparked the crash

A massive sale of Next Vision shares by Fidelity fund ignited a sharp decline in the stock, which spread to the defense stock index. Since its peak in March, the index has lost nearly half its value and is trading below its launch level. The steepest drops were recorded in Next Vision and Arieth Industries, which lost over 80% of its peak.

A massive sale of Next Vision shares by Fidelity fund ignited a sharp decline in the stock, which quickly spread to the entire defense sector on the Tel Aviv Stock Exchange. The sale, executed at a discount of about 6%-7%, led to a drop of nearly double that in one day, and investors interpreted it as a negative signal. Since its peak in March, the defense stock index has lost nearly half its value, and it is trading about 10% below its launch level. The steepest drops were recorded in Next Vision and Arieth Industries, which lost over 80% of its peak. At Arieth, the declines come amid a series of events: an intention to issue Reshef Technologies that was canceled, an unusual dividend distribution alongside weak reports, and a decline in revenue and net profit. The article examines whether this is a sharp correction or the beginning of a deeper trend change, and notes that even when demand for defense products remains high, expensive pricing and realizations can lead to a sharp correction.