# European defence stocks soar as arms makers expect orders boom

Big rises for BAE, Rheinmetall, Thales and Leonardo amid European push to support possible Ukraine peace deal

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**Jasper Jolly**  
Mon 3 Mar 2025 05.02 EST  
Last modified on Mon 3 Mar 2025 12.52 EST

Share prices in European weapons companies have soared as investors anticipated significantly higher spending after the UK and France led an effort to form a peace deal for Ukraine.

Britain’s  rose by 15% on Monday, Germany’s Rheinmetall gained 14%, France’s Thales increased 16% and Italy’s Leonardo was also up 16%. In London the surge in defence related shares helped to push the FTSE 100 to a new record high. It closed up 0.7% at 8871.31.

The moves continued a steep rally in defence stocks as investors expected big increases in defence budgets by European countries, stoked by fears that Washington would withdraw security guarantees.

Donald Trump has shocked longtime allies around the world by claiming that Ukraine is not “ready for peace”, three years after Russia launches a full-scale invasion. He has threatened to withdraw US support for the country after a , descended into acrimony.

The UK prime minister, Keir Starmer, said on Sunday  as he hosted a summit in London with Zelenskyy and 18 other leaders, including France’s president, Emmanuel Macron, to try to form a peace deal to support Ukraine.

Defence bosses in Europe have long argued that weapons spending should be higher, and the prospect of the US removing its support has made politicians pay attention.

"The UK and Germany in particular must – and very likely will – raise defence spending for themselves as well as for Ukraine well beyond recent plans. The UK and Norway have already pledged additional support for Ukraine. Germany will probably do so shortly."

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