Rolls-Royce has reached unprecedented heights in the stock market, hitting an all-time high last week following the reinstatement of its dividend. This development further propelled its stock price by an additional 4%. Meanwhile, European markets prepare for significant economic updates with the release of preliminary euro zone inflation data for February and an impending interest rate decision by the European Central Bank on Thursday.
As financial markets anticipate these developments, the U.K.'s FTSE 100 index is projected to open 42 points higher, while Germany's DAX is expected to see a 135-point rise. Analysts at JP Morgan have responded to the positive market sentiment by upgrading their price targets for Rolls-Royce and another unspecified company, reflecting confidence in continued growth.
In a geopolitical context, the U.K. leader has emphasized the importance of steadfast support for Ukraine, committing to increase defense spending as a percentage of GDP over the coming years. This move comes as parties likely to form the next German government consider establishing special funds for defense and infrastructure, potentially unlocking 400 billion euros in spending.
Across the Atlantic, U.S. Commerce Secretary Howard Lutnick has indicated that the proposed 25% tariff for Mexico and Canada remains "fluid," hinting at ongoing negotiations and adjustments. This uncertainty in trade policies adds another layer of complexity to an already dynamic economic landscape.
Adding to this week's financial activities, earnings reports are set to be released from Euroapi and Bunzl. These reports will provide further insight into company performances amid a backdrop of fluctuating economic indicators and global market conditions.