European shares reached near-record highs as defence stocks gained significantly amid prospects of increased military spending. The pan-European STOXX 600 index rose by 0.3%, continuing a streak of ten consecutive weeks of gains. The European aerospace and defence index surged 6.5% following an agreement by regional leaders to enhance defence spending and develop a Ukraine peace plan. Notable increases were seen in companies like Rheinmetall, BAE Systems, Leonardo, and Rolls-Royce. Additionally, a potential German defence fund further fueled market optimism. Despite this, interest-rate sensitive sectors such as real estate and utilities experienced declines. Economically, the euro zone’s manufacturing downturn showed signs of easing. The European Central Bank’s upcoming policy meeting is anticipated, with focus on comments amidst U.S. tariff plans affecting the EU. Meanwhile, Bunzl shares dropped after reporting a decrease in annual profit. — news from Reuters
