European defence stocks soar after London summit

Jasper Jolly

Financial reporter

Share prices in European weapons companies have soared as investors anticipated significantly higher spending after the UK and France led an effort to form a peace deal for Ukraine.

Britain’s BAE Systems rose by 17% in early trading on Monday, Germany’s Rheinmetall gained 14%, France’s Thales increased 16% and Italy’s Leonardo was up 10%.

The moves continued a steep rally in defence stocks as investors expected big increases in defence budgets by European countries, stoked by fears that Washington would withdraw security guarantees.

Defence bosses in Europe have long argued that weapons spending should be higher, and the prospect of the US removing its support has made politicians pay attention.

Former Polish president and 1983 Nobel Peace prize winner Lech Wałęsa signed a letter to US president Donald Trump expressing “horror and distaste” at his argument with Ukraine’s Volodymyr Zelenskyy in the White House last week.

The letter, signed by Wałęsa and over 30 former Polish political prisoners during the communist era, said that Trump and Vance’s demands that Zelenskyy showed gratefulness were “insulting” in the face of the Ukrainian nation’s heroic fight for freedom.

The signatories said that the “atmosphere in the Oval Office reminded us of that we remember well from interrogations” by Poland’s communist secret services and regime courts.

“The prosecutors and the judges, working on behalf of the omnipotent Communist party police, also told us that they held all the cards, and we held none,” they said.

“We are shocked that you treated Volodymyr Zelenskyy in the same, way,” they said.

They also reminded Trump of the US obligations under the 1994 Budapest Memorandum, which provided security guarantees for Ukraine in exchange for return of Soviet-era nuclear weapons.

Ukrainian president Volodymyr Zelenskyy has posted a video showing damages sustained from Russian attacks on Ukraine over the last few days, saying the country “needs strong support from our partners.”

Ukraine is fighting for the normal and safe life it deserves, for a just and reliable peace. We want this war to end.

But Russia does not, and continues its aerial terror: over the past week, more than 1,050 attack drones, nearly 1,300 aerial bombs, and more than 20 missiles have been launched at Ukraine to destroy cities and kill people.

Those who seek negotiations do not deliberately strike civilians with ballistic missiles.

To force Russia to stop its attacks, we need greater collective strength from the world. Strengthening our air defense, supporting our army, and ensuring effective security guarantees that will make the return of Russian aggression impossible—this is what we must focus on.

Justice must prevail. We believe in the power of unity, and we will certainly restore lasting peace.

Latvia has had a sleepless night after adventure Flow has won the Oscar for best animated feature. It is the first Latvian film to ever be nominated for an Oscar.

The story follows the journey of a cat who must find safety after its home is devastated by a flood. The film has made $20m worldwide and has become the most-viewed theatrical film in Latvian history. It also won the Golden Globe for best animated film in January.

AP reported that more than 320,000 people have watched the film in theatres across the country of nearly 1.9 million, an audience larger than any other film screened in the country in the last 30 years.

“This is a great and historic day for Latvia! And we will all need time to understand what happened, because something big and beautiful occurred!” Latvian President Edgars Rinkēvičs wrote on X following the win.

Prime minister Evika Siliņa, in her congratulations on X to the filmmakers, added, “the cat continues to capture the hearts of people worldwide!”

But AP noted Oscars host Conan O’Brien also gave a shoutout – and a challenge – to another Baltic state following the “Flow” victory: “Ball’s in your court, Estonia!”

“We’ve got you, @ConanOBrien. Estonia will do its best to catch up,” Kristen Michal, Estonia’s prime minister, replied on X.

Christian Stocker has been sworn as the new Austrian chancellor today, leading a three-party coalition government formed after five months of political stalemate since last year’s election won by the far-right Freedom party.

The centre-right People’s party (ÖVP), the Social Democrats (SPÖ) and the liberal Neos, whose first attempt at forming a coalition failed in January, will form the new administration.

“Good things come to those who wait,” Austrian president Alexander Van der Bellen was reported by the Austrian media as joking at the ceremony.

Reuters noted that Stocker, a lawyer with no previous ministerial experience, now heads Austria’s first three-party government since the late 1940s. He is the third successive ÖVP chancellor to enter office for the first time without having led the party into the election campaign.

The coalition deal was agreed late last week, and formally cleared the final hurdle on Sunday, after it got approved by the general assembly of the liberal Neos party.

Ireland looks at changing legislation on overseas troops deployments

Lisa O’Carroll

in Dublin

The Irish government has drafted legislation to remove a de facto ban on any more than 12 troops being deployed overseas as the country makes significant moves to bolster its bare and weak defence force.

It comes just days after minister for foreign affairs and defence Simon Harris has said he is convinced Ireland needs to buy a fleet of fighter jets.

Ireland’s inability to protect its airspace is currently the subject of a high court case seeking to determine whether the Irish government has an arrangement to allow Britain’s Royal Air Force enter Irish airspace to intercept in a hostile event such as a hijacking.

Draft legislation to remove the so-called “triple lock” system requiring the Dáil, the government and the UN to approve troop deployment of over 12 soldiers will go before the cabinet this week.

Deputy prime minister and minister for defence Simon Harris it was not appropriate that they continue with the current system.

“The idea of the UN security council having a veto on where we deploy Irish troops in relation to peacekeeping is something that needs to be modified.

“The UN security council hasn’t found itself in a position to authorise a peacekeeping mission since 2014,” he said.

The changes are a significant shift for Ireland whose defence strategy has been up to now dictated by political neutrality.

Hungarian prime minister Viktor Orbán criticised the London summit, saying that European leaders “decided … they want to go on with the war instead of opting for peace,” calling this view “bad, dangerous and mistaken.”

The Hungarian independent media outlet direkt36 reported over the weekend that Orban sent a letter to the European Council president António Costa demanding immediate negotiations for a ceasefire in Ukraine.

He also suggested, alongside another pro-Russian leader in Slovak prime minister Robert Fico, that he would be prepared to veto the European Council’s conclusions later this week over plans for Ukraine.

But Costa didn’t sound particularly concerned when asked about it this morning during his visit to Moldova as he pushed back on suggestions of a ceasefire at all cost.

He said:

European Union is a project of peace, and the project of peace means that security and defence is necessarily a priority, because peace without defence is an illusion.

…

No one more than Ukrainians want peace, and of course, we are supporting them to achieve this lasting peace.

[But] peace is not just a ceasefire, which offers Russia more time to come again stronger. What we want is just and lasting peace.

Swedish police are investigating a case of attempted sabotage on the island of Gotland over the weekend, which could have affected the island’s water supply, the Swedish daily Aftonbladet reported this morning.

The paper quoted a spokesperson for the Swedish security services confirming an incident, but not offering more details at this stage.

The strategically located island on the Baltic sea has been on high alert due to risk of Russian interference, with Sweden strengthening its presence there. Last week authorities were investigated a suspected cable damage just off the island.

I will update you if and when we hear more on this.

Jakub Krupa

Morning, it’s Jakub Krupa here, taking over from Martin to guide you through the day.

If you have any tips, comments or suggestions, email me at jakub.krupa@theguardian.com.

I am also on Bluesky at @jakubkrupa.bsky.social and on X at @jakubkrupa.

Archie Bland

Our First Edition newsletter today features my colleague Archie Bland summing up the developments over the weekend since the contentious meeting in the White House between Donald Trump, JD Vance and Volodymyr Zelenskyy. Here is an excerpt:

If the White House has sought to villainise Zelenskyy’s behaviour in the Oval Office meeting and continue to present him as an unpopular leader whose people want him out of office, reporting from Ukraine tells a very different story. In this piece from the city of Odesa, Luke Harding hears from ordinary Ukrainians dismayed by the White House’s warmth towards the Kremlin, and who insist their president remains the right man for the job.

“This is our affair. Zelenskyy is our president. He got 73% of the vote. We should decide,” says Olena Palash, who works at a children’s clinic destroyed by Russian attacks. She also says: “Everything is back to front. After three years of war, I’m astounded. Trump doesn’t understand who the aggressor is.”

Trump’s treatment of Ukraine in recent days goes beyond even what Russia might have expected, and the Kremlin appears eager to make the most of its diplomatic advantage. Sergei Lavrov, the Russian foreign minister, praised Trump for “behaving correctly” in an interview reported by state news agency Tass on Sunday. “Donald Trump is a pragmatist,” he said. “His slogan is common sense. It means, as everyone can see, a shift to a different way of doing things.”

Perhaps most tellingly, he sought to draw a clear line between Europe and the US under Trump’s leadership. The Trump team “say directly that they want to end all wars, they want peace”, Lavrov said. “And who demands a ‘continuation of the banquet’ in the form of a war? Europe.”

You can read it in full here: Monday briefing – UK and Europe pick up the pieces after White House car crash

Jean-Noël Barrot has suggested that a month’s truce in Ukraine would show if Russian president Vladimir Putin was acting in good faith.

Speaking on RTL Radio, France’s foreign minister picked up an earlier suggestion by French president Emmanuel Macron that there could be a month’s truce covering air, sea and attacks on critical infrastructure.

Reuters reports Barrot said a pause would show if Putin was acting in good faith and if he would be willing to start negotiations in earnest on a longer-term peace deal.

Barrot added that he thought that Ukrainian President Volodymyr Zelenskyy and US President Donald Trump could be willing to re-engage in direct talks after last week’s debacle in the Oval Office.

Hello and welcome to our live coverage of news from across Europe in the wake of a crucial defence summit in London at which UK prime minister Keir Starmer warned Europe is “at a crossroads in history” and must act to support Ukraine to secure a lasting peace.

After the summit, US President Donald Trump warned that the US should worry less about Vladimir Putin and spend more time worrying about drug lords and murderers among other things “So that we don’t end up like Europe!”

After defending the Russian president during a press conference in which he publicly berated Ukraine’s President Volodymyr Zelenskyy on Friday, Trump dismissed concerns about his growing closeness with Moscow in a post on Truth Social late on Sunday.

Hours earlier, European leaders rallied around Zelenskyy at the summit in the UK, where they vowed to support Ukraine after his disastrous meeting with Trump last week. Starmer said the UK, France and others would work with Ukraine on a plan to stop the fighting, and discuss that plan with the US before taking it forward together.

The Ukrainian leader said there had been no communications at his level with the White House since his meeting with Trump but said a deal for the US to jointly exploit minerals in his country – which was supposed to have been inked on Friday – was ready to be signed.

Last week’s row between Ukraine and the US highlighted the growing chasm between Europe and the US and the president’s latest comments will do nothing to reassure European leaders that the transatlantic alliance is still solid.

In other developments:

• Zelenskyy, sought to move the conversation forward from his difficult meeting with Trump on Friday saying it was “best left to history”, as he signalled Ukraine’s readiness to sign the minerals deal and hoped for “constructive” talks with the US administration on the next steps

• Speaking to reporters after frantic 72 hours, Zelenskyy drew his red lines by saying he would not accept giving any occupied territory away to Russia and insisted on remembering that Russia was the aggressor in the conflict

• The Ukrainian leader said the country needed strong security guarantees or otherwise would face the risk of Russia seeking to restart hostilities with false claims about Ukrainian violations, as it did in the past

• Zelenskyy said he hoped that a UK-French initiative for peace would bear fruit “in coming weeks”, with a number of other countries declaring their interest in being involved in providing security guarantees for Ukraine

• His comments come after French president, Emmanuel Macron, floated the idea of a one-month limited ceasefire that would apply to air, sea and attacks on critical energy infrastructure. Zelenskyy didn’t offer any suggestion if he would accept the proposal, but said he was “aware of everything”

• British prime minister, Keir Starmer, earlier announced details of a new £1.6bn UK export finance contract for Ukraine allowing it “to buy more than 5,000 air defence missiles” to help the country’s defence against Russia, as he concluded a London summit with European, Turkish and Canadian leaders

• Starmer also confirmed plans to form “a coalition of the willing” to enforce a potential peace deal in Ukraine, which he said the UK was prepared “to back with boots on the ground and planes in the air”

• Nato secretary general, Mark Rutte, said a number of Nato countries had signalled their plans to increase defence spending, as he urged media to “stop gossiping about what the US might or might not do”, and insisted the country remained committed to Nato

• Polish prime minister, Donald Tusk, said he hoped the EU’s plans to be unveiled next week would “send a very clear impulse showing Putin and Russia that no one here, in the west, intends to surrender to his blackmail and aggression”

• Canadian prime minister, Justin Trudeau, offered a passionate defence of Zelenskyy, saying that in his comments in the Oval Office on Friday “he pointed out in so many words that Vladimir Putin is a liar and a criminal and cannot be trusted to keep his word in any way”

• After the summit, Zelenskyy also met with King Charles at his estate in Sandringham, where the pair had tea together for nearly an hour. The visit has been seen in Westminster as an attempt to even out treatment of the Ukrainian and US presidents after Starmer invited Donald Trump for a state visit last week

It is Martin Belam with you from London. You can contact me at martin.belam@theguardian.com.