European Stock Index Hits All-Time High Amid Expectations of Higher Military Budgets

More military spending can lead to the European defense industry entering a ‘golden era,’ an investment expert said.

A soldier of 13th Khartiia Brigade in a trench during a snowstorm in Kharkiv, Ukraine, on Dec. 6, 2024. Nikoletta Stoyanova/Getty Images

The STOXX 600, a pan-European stock index, surged to new highs on Tuesday as investors expected a potential Russia–Ukraine peace deal and increased defense spending by NATO nations to boost the arms industry.

The STOXX 600 index hit an all-time high of 556.80. The market surge was supported by a jump in the SXPARO index, which tracks European defense and aerospace stocks. SXPARO was up 1.68 percent at around 6 a.m. ET on Tuesday after rising 4.6 percent on Monday.