Markets cashed in on the war in Ukraine but may like peace with Russia even more, top analysts say
Key Takeaways
Russia has broken 190 different "deals" over Ukraine since 1994, so it is unlikely that Europe will stop preparing for future action from Moscow.
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investment
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August 12, 2025
11:07 AM
Fortune
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Finance· cashed in on the war in Ukraine but may peace with Russia even more, top analysts sayBy Jim EdwardsBy Jim EdwardsExecutive Editor, Global NewsJim EdwardsExecutive Editor, Global NewsJim Edwards is the executive editor for global news at Fortune
He was previously the editor-in-chief of Insider's news division and the founding editor of Insider UK
His investigative journalism has changed the law in two U.S. federal districts and two states
Supreme Court cited his work on the death penalty in the concurrence to Baze v
Rees, the ruling on whether lethal injection is cruel or unusual
He also won the Neal award for an investigation of bribes and kickbacks on Madison Avenue.SEE FULL BIO War or no war, Europe will continue its military spending, Macquarie says.While European benefited from the Ukraine war, analysts believe peace could boost the euro and stocks even more
Lingering distrust of Russia means Europe is unly to cut defense spending after any ceasefire
NATO’s new commitment to 5% of GDP for defense means military investment will continue regardless of peace talks, analysts at Macquarie say
President Trump meets Russia’s Vladimir Putin in Alaska later this week to discuss the possibility of a ceasefire or a peace deal in Russia’s invasion of Ukraine
Politically, Trump would very much to claim credit for ending the conflict on Europe’s Eastern border
Unfortunately, Russia has broken 190 different “deals” over Ukraine since 1994, and 25 of those were since 2014
So there is every chance that a “deal” may be announced, ed by a resumption of hostilities by Moscow
For investors in Europe, this may be no bad thing, according to Macquarie analysts Thierry Wizman and Gareth Berry
The euro may rally against the dollar, they predict, as it is unly that Europe will roll back defense spending simply because Putin signs another piece of paper
And, they note, European stocks have done well this year, boosted by a massive military spending package from NATO countries that comits all European allies to devote 5% of their GDP to defense. “The spect of European growth and re-inflation may have also been boosted by the war, since the conflict energized new commitments to increase defense expenditure and associated infrastructure expenditure in Europe
Notably, the June 2025 NATO summit saw a formalization of the plan to get each country to spending the equivalent of 5% of GDP on defense by 2035,” they write. “The ramp up is steeper than in the U.S.” The scale of Europe’s return to military spending is under-appreciated, according to an analysis of satellite imagery carried out by the Financial Times
More than seven million square meters of new military duction facilities have been added in Europe since 2022, at 150 sites across 37 companies
After the Cold War in 1989, Europe reduced its defense spending to enjoy a “peace dividend.” Might that not happen again, if Putin freezes his action in Eastern Ukraine? Unly, the Macquarie team says, because no one in Europe believes that Putin is ly to disarm or avoid future military engagements. “A review of what analysts have written this topic leans us strongly toward the view that the EU and NATO would not roll back commitments toward higher defense spending if some form of ‘peace’ came to Russia and Ukraine
Even with a peace agreement or cease-fire, the long-term implications of Russia’s actions and the potential for future conflict could lead the EU to maintain or increase defense spending to ensure long-term security and deter potential aggression later,” they wrote
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