The risk of war in Europe is increasing, and European stocks in the defense sector are leading the way.

Baader Europe stated in a research report that European defense stocks performed strongly last week, with gains continuing into this week due to the expansion of war risks in Europe. The group pointed out that recent reasons for the rise in stock prices in this sector include: Russia's attempts to test the defense capabilities of the North Atlantic Treaty Organization in the Baltic region causing concerns, and a batch of large orders that were expected but had not been finalized. Thales received a new order for a Danish air defense system, while Rheinmetall stated that they are ready to deliver the "Sky Ranger" air defense cannon to Ukraine and other European countries. The group mentioned that the stock prices of these two companies increased by 12.7% and 8.7% respectively last week. On Wednesday, Rheinmetall's stock price rose by 2.5%, Hensoldt by 2.3%, Thales by 1.1%, Renk Group by 0.95%, and Babcock International by 0.7%.