(Reuters) – European shares hovered near record highs on Monday, propelled by defence stocks after the continent’s leaders agreed to boost defence spending and draw up a Ukraine peace plan to present to the United States.
The pan-European STOXX 600 index was up 0.4% as of 0811 GMT, aiming to build on a run of ten straight weeks of gains.
The European aerospace and defence index surged more than 6% to a record high after the continent’s leaders agreed, over the weekend, that they must spend more on defence to show the U.S. they can protect themselves.
Rheinmetall surged 17.4%, BAE Systems jumped 11.6% and Leonardo advanced 15.1%.
Providing an additional boost was a Reuters report that said the parties in talks to form Germany’s new government were considering setting up a defence fund.
German blue-chip index jumped 0.9%, outperforming its peers.
The European Central Bank will be in the spotlight ahead of its policy meeting later this week. While a rate cut is widely expected, the focus will be on the central bank’s comments amid widespread uncertainty after U.S. plans for “reciprocal” tariffs on the European Union.
(Reporting by Nikhil Sharma; Editing by Savio D’Souza)
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