Ukraine’s President Volodymyr Zelensky, Britain’s Prime Minister Keir Starmer and France’s President Emmanuel Macron hold a meeting during a summit at Lancaster House in central London on March 2, 2025. European leaders descended upon London for talks to “drive forward” action on Ukraine, according to the office of UK Prime Minister Keir Starmer.
Justin Tallis | Afp | Getty Images
European markets were higher on Monday, amid a charge in defense shares after regional leaders held security talks that touched on bolstered military spending.
The regional Stoxx 600 index moved between losses and gains in early deals but was 0.59% higher by 10:55 a.m. in London. The Stoxx Europe aerospace and defense index rose nearly 6%, putting it on course for its best session in five years.
Reuters reported Sunday that the parties likely to form the next German government were considering setting up special funds for both defense and infrastructure, with the former potentially unlocking 400 billion euros ($416 billion) in spending.
Robin Winkler, chief Germany economist at Deutsche Bank, said in a Monday note that the move would be “a fiscal regime shift of historic proportions.”
Data out Monday showed euro zone inflation dipped to 2.4% in February, slightly above analyst expectations, ahead of the European Central Bank interest rate decision on Thursday.
Economists surveyed by Reuters had expected inflation to dip to 2.3% in February, down from 2.5% in January.
The euro zone Purchasing Managers’ Index meanwhile showed contraction in the bloc’s manufacturing sector eased to its least severe in two years.
U.S. stock futures edged up early Monday and Asia-Pacific markets mostly rose overnight as traders awaited more clarity on President Donald Trump’s plans to impose tariffs on key U.S. trading partners this week.
U.S. Commerce Secretary Howard Lutnick reportedly told Fox News on Sunday that the exact tariff that will be levied against Mexico and Canada starting Tuesday is still “fluid,” which means it could be lower than the proposed 25%. He added that the additional 10% duty on China imports is “set.”