The European sector appears to be in clear difficulty defense, penalized by theagreement on tariffs between the US and the EUThe agreement, in fact, would include the obligation for Europeans to purchase 750 billion dollars of US energy and invest another 600 billion, in addition to the supply of significant quantities of weaponry“We don't know what the exact figure is, but we produce the best military equipment in the world,” said the US president, Donald Trump.
In the aftermath of the agreement, however, EU sources wanted to specify that the purchase of weapons is not a matter within the competence of the European Commission and in the negotiating package on tariffs with the United States "no specific figures were included". Rather - it was said - "it is a question of an expectation expressed by President Trump regarding increased defense spending in Europe, which could translate into increased orders for the US military industry. But it was not included in the official calculations.
Defense: EU stocks suffer on the stock market
It's true that the repercussions on the stock market were not long in coming. In Milan on Monday, July 28th Leonardo travels at the bottom of the price list, in Frankfurt it suffers Rheinmetall, in Paris it goes down Thales and in Stockholm it is in decline SaabStocks in the sector have risen sharply since the beginning of the year, driven by ReArm Eu plan proposed in March by the European Commission to strengthen the Union's military capabilities.
Defense: Is the US-EU arms deal a threat to profits?
The goal was to speed up European strategic autonomy with new investments in technologies, weapons production, and cooperation between member states. Thus, since the beginning of 2025, Leonardo has achieved progress of over 80%, Rheinmetall of over 177%, Thales of more than 67%, and Saab of over 122%. Now, however, the military question seems to have taken a new turn, with the investments promised to the United States that threaten the sector's profits and impact the titles.
Defense: Iveco and the sale to a joint venture between Leonardo and Rheinmetall
As regards Leonardo shares – he underlines Radiocor – the latest rumours also have an impact on the title according to which Iveco would be close to selling its defense division to the joint venture formed by the company led by Roberto Cingolani and from Rheinmetall. According to Bloomberg, in fact, the operation would be at an advanced stage. The operation would satisfy the requests of the Italian government and would pave the way for the sale of the rest of the commercial trucking sector to Tata MotorsThe agreement between Iveco and Leonardo could therefore be reached in the coming weeks, while the spin-off option remains open in the background.
According to analysts of Intermonte, "the news gives a higher probability to the sale of IDV to Leonardo-Rheinmetall for a valuation of approximately €1,6 billion compared to our baseline scenario of a spin-off with a valuation of approximately €2,17 billion. However, this scenario appears to be preparatory and accelerate the possibility of the sale of the former defense business, with Tata Motors apparently in pole position."
