Archer Aviation Inc. (ACHR) saw a remarkable surge in its stock price on January 3, 2025, closing at $11.51, up 20.27% from the previous close of $9.57. The stock opened at $9.65 and reached a high of $11.51, with trading volume soaring to 54,484,603 shares, significantly above the average. The rally was primarily driven by reports that the U.S. government is considering a ban on Chinese drones, a move that could benefit U.S.-based companies like Archer by reducing competition in the unmanned aerial systems sector. This news, coupled with Archer's recent strategic expansion into the defense sector through the launch of Archer Defense in partnership with Anduril Industries, has fueled investor optimism.
The stock's momentum was further bolstered by increased call option activity, indicating bullish sentiment among traders. Archer's involvement in the defense sector, particularly its partnership with Anduril to develop military-grade VTOL aircraft, positions the company to potentially secure lucrative government contracts. Despite being in the development stage with no revenue, Archer's strategic moves and the potential regulatory changes have captured the market's attention, driving the stock's significant gains.