Defence and aerospace stocks saw renewed momentum in Tuesday’s intraday trading session as intensifying geopolitical tensions in the Middle East and expectations of a higher defence allocation in the upcoming budget spurred investor interest.Leading the gains was Data Patterns (India) Ltd, which surged 3% to a day’s high of Rs 3,049.50. Bharat Dynamics Ltd (BDL) followed closely with a 2.8% rise to Rs 1,940.70. BEML shares rose 2.2% to Rs 4,473.00, while Hindustan Aeronautics Ltd (HAL) climbed 1.6% to touch Rs 5,130.50, according to an ET report.The surge comes amid rising tensions between Iran and Israel, pushing investors toward sectors considered resilient during geopolitical crises. Market watchers believe the current situation may also accelerate government defence spending plans.Sankhanath Bandyopadhyay, Economist at Infomerics Valuation and Ratings, noted, “Defence stocks look promising due to the ongoing geopolitical tussle between Iran and Israel. Moreover, the Indian government is likely to enhance defence spending from the current 2% of GDP to 3–4% over the next decade.”He added that the Centre’s aim to achieve Rs 25,000 crore in defence exports by FY26 provides further support to stocks with export-oriented operations. The heightened global uncertainty has strengthened the outlook for companies catering to military and aerospace demand, analysts said.Cautioning investors, Bandyopadhyay said, “In the current scenario, geopolitical tensions will likely be lingering between different countries, especially as being reflected in rising tensions in the Middle East. Investors should carefully assess the financials and outlook of such stocks before investing, and there should be a judicious mix so that a healthy dividend can also be earned.”The rally also reflects growing confidence in India’s indigenous defence manufacturing sector, which has been prioritized under the government’s Atmanirbhar Bharat initiative.