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The actions of European defense companies gathered on Monday, led by Germany Rheinmetall, while investors bet that the governments of the region would invest more in their own guarantee.
Rheinmetall increased 9% at the start of negotiations in Frankfurt, the BAE systems increased by 5% in London and Thales climbed 4% in Paris. Europe Stoxx aerospace and defense Index has reached its highest level in more than 30 years.
The bounce at the sector’s scale intervenes while European leaders gathered in Paris to determine how to react to the American president Donald Trump Decision to start talks With Russia Vladimir Putin by finishing the war in Ukraine.
Since his return to the White House, Trump has increased pressure on European allies to increase their defense expenses beyond a NATO target by 2% of GDP, floating 5% as a new target – which , at present, is about to reach unique.
Higher politicians across Europe have committed themselves in recent days to spend more in defense.
Addressing Reuters on Friday, Armin Papperger, Managing Director of Rheinmetall, said that the company would increase more than expected.
In an interview with the Financial Times this month, Papperger said: “It takes size to be able to play in the same league as American arms companies. . . To meet high demand in Europe, we need the production of industrial -scale weapons – this is also what politicians ask. »»
Until the large -scale invasion of Ukraine Russia almost three years ago, European investors were wary of supporting the defense sector due to ethical concerns.
