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World Economy
Apr 17, 2026

Iran War Boosts Wall Street, Defense Firms, AI, and Renewable Energy

AI Summary
The ongoing Iran war has negatively impacted the global economy, but certain sectors such as Wall Street, defense firms, artificial intelligence, and renewable energy are thriving due to increased demand and investment.

The International Monetary Fund (IMF) has downgraded its global growth forecast for 2026 from 3.3% to 3.1%, citing the impact of the US-Israeli war on Iran and the shutdown of the Strait of Hormuz on the world economy.

In a worst-case scenario of a prolonged war, global growth could fall to 2.5% in 2026, with low-income and developing economies hit the hardest by soaring commodity and energy prices.

However, some industries are benefiting from the uncertainty:

Wall Street Investment Banks

Wall Street investment banks are thriving due to increased trading activity, with Morgan Stanley reporting a profit of $5.57bn, up 29% year on year, and Goldman Sachs reporting a profit of $5.63bn, up 19% year on year.

Aerospace and Defence

The aerospace and defence industries are booming due to increased global defence spending, with the MSCI World Aerospace and Defence Index reporting net returns of 32% year on year.

Artificial Intelligence

The AI industry is expected to grow from $189bn in 2023 to $4.8 trillion by 2033, with Taiwan Semiconductor Manufacturing Company posting a net income of $18.1bn for the first three months of 2026, up 58% year on year.

Renewable Energy

The renewable energy sector is also benefiting from the war, with 150 countries having active policies to advance renewable and nuclear deployment, and the S&P Global Clean Energy Transition Index up 70.92% year on year.