Defence shares lift European stocks to near record highs

LONDON, Mar 03 (Reuters): European shares extended gains to trade near a record high on Monday, as defence stocks received a boost on prospects of higher military spending by the region.

The pan-European STOXX 600 index was up 0.3 per cent at 0932 GMT, set to build on ten straight weeks of gains.

The European aerospace and defence index surged 6.5 per cent to a record high after the continent's leaders agreed, over the weekend, to boost defence spending and draw up a Ukraine peace plan to present to the United States.

Rheinmetall surged 11.4 per cent to a record high, BAE Systems jumped 13.5 per cent and Leonardo advanced 11.6 per cent and Rolls-Royce was up 5.7 per cent.

France's Thales and Dassault Aviation were up 11.7 per cent and 13.4 per cent, respectively.

Providing an additional boost was a Reuters report that said the parties in talks to form Germany's new government were considering setting up a defence fund.