On Monday morning, as the Middle East conflict expanded and missile technology became a market focus, investors poured into the European defense sector.
The conflict entered its third day, with US and Israeli forces continuing strikes against Iran, while Israel also targeted Hezbollah positions in Lebanon. Iran resumed attacks on Israel and aimed at airports and other facilities in neighboring Gulf countries.
BAE Systems led the gains, surging 7.9%; Saab and Thales followed closely, both rising 6.1%.
German sensor and radar supplier Hensoldt increased by 5.2%; Norway's Kongsberg and Italy's Leonardo both rose 4.7%; explosives manufacturer Jinling Group climbed 4.5%.
German defense giant Rheinmetall, French aerospace company Dassault Aviation, and Spanish technology firm Indra Sistemas all advanced 3.5%.
Citigroup analyst Charles Armitage stated that companies producing air defense systems and multinational projects are likely to attract investor attention.
This includes the European Sky Shield Initiative—a defense project led by Germany with participation from 22 countries, involving European and American defense contractors such as Diehl Defence, Rheinmetall, Hensoldt, and RTX.
Armitage noted that other projects likely to gain attention include the SAMP/T missile defense system operated by the MBDA and Thales joint venture Eurosam, and the "Michelangelo Dome" cyber system launched by Leonardo.
