European defense stocks jump on Sweden deal, analyst upgrades, Iran peace bid

European defense stocks rallied broadly as a trio of catalysts — Sweden’s ~$4.25bn purchase of four FDI frigates from Naval Group, Citigroup upgrades, and signs of de‑escalation in the Iran conflict — lifted the sector by roughly 2–5% on Tuesday. Key names like Rheinmetall and Saab saw notable moves after Citi upgraded Rheinmetall to buy (€1,408 PT) and nudged Saab to neutral (SEK 527 PT). Rheinmetall also flagged serial production wins and Bundeswehr orders, while Saab jumped on contract participation news. The story underscores how geopolitics and analyst revisions are driving near‑term flows into European defence equities, even as analysts caution a Ukraine peace outcome could sharply reverse gains for some names.