NATO is dead,” wrote Vertical Research Partners analyst in a Tuesday report summarizing recent news for his clients.

Shares in London-listed BAE Systems soared 7% on Monday. Germany's Rheinmetall jumped 8%, while Italian and French defense firms also got boosts.

European defense stocks rose, buoyed by the prospect of higher military budgets, while global markets were largely subdued with the U.S. closed to mark Presidents Day.

European defence stocks surged on Monday as governments faced pressure to hike military spending in the region, following calls from Washington for higher expenditure ahead of talks between the U.S. and Russia on a possible Ukraine peace deal.

European leaders were shocked by the hostility of JD Vance’s scathing speech in Munich criticizing Europe’s exclusion of far-right groups from power.