While the tariff of US President Donald Trump and his transformation into Ukraine’s policy in Washington is sending tremors through global stock markets, defense companies in Europe are running high while investors are betting on the continent responsible for its defense.

As Trump communicates with Russia and his suspension of military aid to Ukraine, which raises doubt about the American commitment to the security of Europe, European leaders are racing to intensify defensive spending.

After achieving double number this week, the shares of senior European defense companies wander around their levels at all as investors are looking for profit from “America first” from Trump.

Rheinmetall and Hensoldt in Germany, which increased by up to 6 percent on Wednesday, rose about 86 percent and 90 percent, respectively, since the beginning of the year.

Leonardo and France in Italy gained more than 70 percent, while BAE systems in the UK increased by approximately 40 percent.

In a blatant contradiction, the S&P 500 normative index, which tracks the performance of 500 of the largest American companies, decreased by 1.5 percent in 2025.

In response to Trump and [Russian President Vladimir] Putin, Europe will significantly raise its defensive spending. “This is very positive for defense companies,” Holger Schmiding, chief economist at Berneberg Bank, told Al Jazerera.

“Their long -term horizons are bright. They will also find it easier to attract talents.”

European Commission President Ursula von der Lin announced on Tuesday plans to fill up to 800 billion euros (854 billion dollars) in a new defensive spending over four years, announcing that Europe entered the “era of armament”.

Von der Layen said 650 billion euros (694 billion dollars) of spending can be achieved by member states that raise defense budgets by 1.5 percent of GDP (GDP) – a double expenses.

The NATO military planners have worked on assuming that if Russia attacked Europe, the United States will quickly increase 100,000 soldiers stationed on the continent to 300,000. However, the Trump administration has made it clear that it wants to lead Europe to lead its defense – and wonder how much the United States may support in Europe in such a scenario.

Think Tank Bruegel, which is based in Brussels, has estimated its headquarters, if Europe does not have the U.S. security umbrella under NATO, it will need to collect an additional combat force of 300,000 soldiers to repel a Russian attack on a European country. NATO European members have Completely two million active soldiers in the service at present.

Despite its rise to nearly a third of 2021 to 2024, the European Union’s defensive spending is far from the United States and is subject to a lesser degree than NATO goal of expenditures equivalent to 2 percent of GDP.

The expenses of the European Union related to the army in 2024 amounted to 326 billion euros (348 billion dollars), or about 1.9 percent of the joint gross domestic product, according to the European Defense Agency.

NATO Secretary -General Mark Retty said that the coalition members, which includes all European Union countries, as well as the United States, Canada and the United Kingdom, will need to raise defense budgets to “more than 3 percent of GDP.

Trump, who has repeatedly accused Europe of expressing US security guarantees, prompted NATO members to spend 5 percent of GDP.

“We expect European defense expenditures to reach 3.1 percent of GDP by 2029 and rise to 3.5 percent by 2032,” said Lorridana Mouhairimi, stock analyst in Moriningstar.

“If Europe reaches 3.5 percent of GDP by 2032, this will be translated on average to an additional $ 300 billion annually, which represents an increase of 70 percent of 2024 levels.”

She said that the largest part of this increasing spending should benefit European defense contractors by “increasing purchases within Europe and unifying the industry.”

Muharrami said that the European defense sector also benefits from major size economies.

Currently, Europe imports 26 percent of defense equipment, with 60 percent of imports coming from the United States. Although we do not expect Europe to stop US purchases-given the immediate need for ready-made capabilities and long-term technological synergy-we expect a major shift towards purchases within Europe. “

The defense industry in Europe achieved sales of 158.8 billion euros (169.5 billion dollars) in 2023, an increase of about 17 percent over the previous year, according to the Association of Security, Security and Defense Industries in Europe.

However, the continent’s defense sector has long been delayed behind its American counterpart. American companies took seven sites in the list of 10 contractors for the ten defense in 2024, including the first five.

According to the 2021 report issued by the strategy &, a unit of Price Waterpoobers, US defense companies have grown by 20 percent to $ 277 billion from 2014 to 2019, while European companies ’revenues are stagnated during the period by about $ 100.4 billion.

Tobias Muller, defense expert in the strategy, said.

“To move forward, they need to unify the industry, increase efficiency and effectiveness, invest in innovative defense technologies, and improve the flexibility of supply chain and investment in public and private partnerships.”

Muller said that Trump’s contradictory position on security in Europe could be a golden opportunity for the European defense sector to rise.

“This is” the last invitation “of Europe to invest in more defensive capabilities,” he said.