A flurry of trading has helped push the Pan-European Stoxx 600 index to a record high as investors expect Europe’s governments to increase military spending.

European defense stocks continued their rally on Tuesday, as President Trump’s threats to reduce American military support to the continent and NATO raised the prospect that Europe’s governments will increase military spending.

The flurry of trading helped push the Pan-European Stoxx 600 index to a record high; the Stoxx Europe Total Market Aerospace & Defense index is up 19 percent this year.

Senior American and Russian officials gathered in Riyadh, Saudi Arabia, on Tuesday for a high-stakes meeting that could further determine the sector’s fate. At the top of the agenda is ending the fighting in Ukraine, Europe’s deadliest war in generations. But representatives from Europe or Ukraine did not attend, raising questions about cracks in the Western alliance.

The State Department is playing down the talks as exploratory.

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