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       Escalation of the war in Kosovo is likely to bring more business
for U.S. defense contractors. And that's giving a lift to some
defense company stocks.
        Raytheon -- which makes the Tomahawk cruise missiles being
used against Serb forces -- has been the industry's biggest gainer.
Its stock is up 17% the past two weeks. Stocks of military
equipment manufacturers Lockheed Martin and Boeing are up 8%
and 12%, respectively.
        "Some of the performance is driven by excitement in Kosovo
and renewed interest in their products," says analyst Bill Fiala at St.
Louis-based brokerage Edward Jones.
        "This is not just a flash in the pan," says analyst Shawn
Narancich of D.A. Davidson & Co. in Great Falls, Mont. "Kosovo
is just the catalyst. We're going to keep seeing money flowing into
defense stocks."
        The USA's defense equipment, such as the satellite-guided
smart bombs, has stolen the international spotlight as NATO air
forces pound Serbian forces. That could mean increased foreign
interest in U.S. military equipment, analysts say.

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