(This is The Best Stocks in the Market , brought to you by Josh Brown and Sean Russo of Ritholtz Wealth Management.) Josh — Good morning, the events unfolding in the Middle East over the past week have led to sharp price gains for a few of the names on our Best Stocks list. In recent weeks, we’ve written about Axon Enterprise (AXON) and RTX Corp (RTX) , two aerospace and defense names that were on the verge of major breakouts at the time we wrote them up about a month ago. Well, those breakouts have happened. I’ll update my risk management comments below. Sean is also going to bring you up to speed on the sector leaderboard and some stuff about geopolitical shocks. Have a great week. Sector Leaderboard As of 6/16/2025 morning, there are 116 names on The Best Stocks in the Market list Top Sector Ranking: Top Industries: Top 5 Best Stocks by Relative Strength: Sector Spotlight: Energy Sean — Geopolitical events often spark sharp, short-term moves in energy and aerospace stocks. We have seen this a number of times in just the past few years: Ukraine-Russia in 2022, Israel-Hamas in 2023, and now escalations in Iran. For energy companies, disruptions in oil supply chains or uncertainty around resource access can lead to price spikes in crude and natural gas. Last Friday, WTI was up 7% following the attack in Iran. Similarly, aerospace and defense stocks typically benefit from increased defense spending, elevated security concerns, or government stimulus aimed at military readiness. In the immediate aftermath of geopolitical shocks, these sectors often outperform broader indices as investors seek refuge in assets tied to national security and resource control. We currently have 4 stocks on our list in the energy sector: EQT , EXE , KMI , and WMB, all four of which we mentioned on our piece released on May 22. Over the past month, EXE is up 2.8% and WMB is up 2.7%, both outperforming the S & P 500 up 1.6% while EQT and KMI are underperforming over that period, up .9% and .7% respectively. Sector spotlight: Aerospace Looking at aerospace, we mentioned AXON and RTX on May 19 – see story date in red circle on charts: AXON: RTX: These unfortunate events often prompt a swift reassessment of defense spending assumptions, both in market forecasts and government policy planning. Investors price in these changes, anticipating higher revenues for defense contractors and suppliers. Even the perception of sustained geopolitical risk can extend spending tailwinds, as nations reevaluate long-term defense strategies, upgrade outdated systems, and invest in next-gen technologies like cybersecurity, drones, and missile defense. This shift in assumptions is reflected by price, and we’re seeing it happen in real time. Below is AXON and RTX vs the S & P 500 since we mentioned them on May 19: Over the long run, the fundamental value of energy and aerospace stocks (and all stocks) are influenced by structural and secular trends, not one-off conflicts. Markets tend to normalize after the initial wave of uncertainty fades. That said, energy and aerospace remain among the best portfolio hedges during periods of geopolitical instability. Their performance is often counter-cyclical to the risk-off sentiment we see, offering diversification when other sectors fall. Investors can view these holdings not as reactionary plays, but as strategic insurance against global volatility. Risk Management Josh — I think we’re in a secular bull market for defense-oriented stocks, unfortunately for the world. I don’t know what’s going to happen with all of these international conflicts, I can only tell you they don’t seem to be calming down. There’s war in the Middle East, in the heart of Eastern Europe and, as always, the threat of China doing something aggressive with respect to Taiwan is going to be a constant. By which I mean to say, investors can let their stops run wide and give these names a longer leash to recover from sell-offs. In the chart above, you can see a volume spike accompanied by a slightly overbought RSI reading above 70. There are people who will tell you this is a reason to sell. Those people eat crayons and do not know what they’re talking about. RTX is one of the leading suppliers of rockets, missile systems and both military and civilian aircraft engines. I think it’ll hold its uptrend given this backdrop. Just in case it doesn’t, traders may want to utilize the $130 area as a place to reduce exposure. Investors can use the 50-week moving average around 120 as a trailing stop. If I were long, I would update my stop loss order each Friday. On Axon, I said the following when we first put a spotlight on the name in mid-May: “As you can see below, this is a breakout in progress. Short-term traders would use $700 as a pivot point. Investors may want to set a stop at the top of that gap around the $600 level. A pullback on light volume could help the stock work off its slightly overbought momentum and may provide a good entry.” Now that the breakout has taken place, I would be raising that investment stop up to the rising 50-day near $665. That would represent a drop of 15% and below that level the story is muddier, even though the name would likely stay on the Best Stocks list. See the chart below: Traders can choose their own adventure depending on time frames and tax consequences. 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