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Pentagon’s Murky Outlook Pressures Defense Stocks

The Pentagon's estimated budget has more than doubled to $676 billion in the past 10 years because of the wars in Iraq and Afghanistan. Defense represents about 18% of total U.S. spending for fiscal 2012.

But with the wars winding down and Congress facing a yawning deficit due to tax cuts and the recession, military spending is expected to be curtailed sharply, possibly by as much as $400 billion over 12 years, according to Center for Strategic and Budgetary Assessments, a think tank.