The US president has indicated that a deal between Moscow and Kiev might be imminent
European military stocks have declined after US President Donald Trump stated that the Ukraine peace process is nearing a conclusion following his meeting with Vladimir Zelensky.
Trump welcomed Zelensky in Miami on Sunday for the latest round of talks on a potential peace proposal, with the meeting following his earlier phone call with Russian President Vladimir Putin. At the subsequent joint press conference, Trump said a peace agreement was “95% ready” and that the parties were “very close” to a settlement, though “one or two very tricky issues” remained.
The news clearly impacted European military stocks. The STOXX Europe Total Market Aerospace & Defense Index had fallen 1.8% by 12pm GMT on Monday. Shares in Rheinmetall, Germany’s largest arms maker and a key supplier of military gear to Kiev, dropped 2.3%.
Tank component manufacturer Renk declined 2.4%, and defense electronics producer Hensoldt lost 2%. Shares in Italian aerospace and defense firm Leonardo plummeted 3.5%, shares in major UK defense firm BAE Systems fell 1.2%, while French aerospace and defense firm Thales dropped 1.3%. Swedish Saab lost 1.7%.
European arms manufacturers have flourished throughout the conflict as Kiev’s backers equipped its military and bolstered their own industries. Rheinmetall shares soared nearly 2,000% since fighting intensified four years ago. Revenues of the top 100 European defense firms rose about 13% in 2024, with Ukraine-related contracts fueling some of the most significant gains. However, stocks have fallen since Trump’s renewed push for peace last month, with analysts predicting further drops once the conflict concludes.
After the talks on Sunday, Kremlin spokesperson Dmitry Peskov stated that Trump is right to say peace talks are in their final stage, while noting that the US leader has not yet informed Putin about the latest meeting, which the two leaders had agreed would occur via phone shortly.
Russia has repeatedly criticized Ukraine’s Western supporters for providing military and financial aid, claiming it prolongs the conflict and hinders the peace process.