Germany will borrow about €800 billion for rearmament in a historic policy shift, the Financial Times reported, as Finance Minister Lars Klingbeil projects the country’s debt‑to‑GDP ratio to reach about 69.7% in 2027. The unprecedented funding push underlines Berlin’s long‑term strategic pivot on defence spending.
Economic data offered a mixed backdrop: German industry expanded for a second month, rising 0.9% in May and beating expectations, a sign of resilience in the manufacturing heartland even as policymakers weigh bigger fiscal commitments.
European Central Bank executive Isabel Schnabel cautioned that the continent is not yet back to pre‑war normality despite the fall in oil prices, a reminder that energy‑driven relief has not erased broader geopolitical and inflation risks.
Markets saw a rotation away from AI winners after bumper results. Asian tech stocks fell as investors pared positions following Samsung’s blowout quarter — the company’s earnings surge, driven by AI chip sales, prompted profit‑taking and a drop in the stock of as much as 8%. The move fed a broader sector rotation into names that had lagged the recent rally.
Regional markets were mixed: Japanese and mainland Chinese equities slipped about 1% led by tech weakness, while European shares traded near flat. In the U.S., the Nasdaq looked set to open roughly 1% lower, with the S&P 500 and Dow Jones relatively stable. Oil ticked up about 1%, with Brent crude trading near $72.50 a barrel.
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