FRANKFURT / LONDON (IT BOLTWISE) – The delay of a summit between Donald Trump and Vladimir Putin has increased uncertainties in the Ukraine conflict and led to a rise in defense stocks. Rheinmetall and Hensoldt are recording significant price gains while the market is excited about possible developments. Analysts see the geopolitical situation as an opportunity for further price increases, as an imminent ceasefire appears unlikely.
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The recent postponement of a planned summit between Donald Trump and Vladimir Putin has further heightened geopolitical tensions in the Ukraine conflict. These uncertainties have led to a rise in defense stocks, with Rheinmetall and Hensoldt in particular benefiting from the current situation. Both companies were able to significantly increase their share prices after a weak October, causing a stir in the market.
Rheinmetall, a leading provider of defense technology, recorded a share price increase of 2.6 percent in the DAX. This marks the third consecutive day of gains and shows investor confidence in the company’s stability and growth potential. Despite this positive development, the current price of 1,826 euros remains below the record high from the beginning of October, which was 2,008 euros.
Defense companies such as Hensoldt and Renk were also able to benefit from the geopolitical uncertainty in the MDAX. Hensoldt shares rose by 3.7 percent, while Renk shares rose by 3.2 percent. An exciting race is developing between Renk and the Friedrich Vorwerk shares for the title of the best stock in the DAX index family by 2025. Friedrich Vorwerk is currently leading the SDAX with an impressive increase of 292 percent year-on-year.
President Donald Trump expressed caution about a possible meeting with Vladimir Putin, emphasizing that a summit should only take place if tangible results are expected. This uncertainty about future political developments is further fueling interest in defense stocks. Analysts like Chloe Lemarie of Jefferies Research believe the lack of progress in negotiations could continue to have a positive impact on defense stocks.
ING Bank foreign exchange strategist Francesco Pesole stressed that markets need concrete policy progress to respond sustainably. The current situation shows that speculation alone is not enough to cause long-term market movements. Nevertheless, demand for defense stocks remains high as an imminent ceasefire in the Ukraine conflict is considered unlikely.
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