The US reportedly handed Kiev a 28-point peace proposal last week and gave it until Thursday to respond. The framework was discussed in Geneva on Sunday, with US President Donald Trump saying afterwards that “something good” may be happening.

The peace push immediately unnerved investors, triggering a fierce sell-off of shares in Rheinmetall, Germany’s largest arms manufacturer and a key supplier of military equipment to Kiev. Rheinmetall stock has fallen by over 14% over the past five days, with defense-electronics producer Hensoldt recording a similar drop.

“Investors fear that an end to hostilities could also mean the end of the “super-cycle” for defense stocks,” Boerse-Express wrote.

Germany has become Kiev’s second-largest arms provider after the US, and Rheinmetall, which produces tanks, artillery systems, and ammunition, recently reported surging profits for the first nine months of 2025, alongside a record order backlog driven by the conflict and rising EU military budgets. Company shares have climbed nearly 2,000% since fighting escalated almost four years ago.

During the previous US attempt to broker peace in February, Rheinmetall CEO Armin Papperger argued that even if the fighting were to end, it would be “wrong” for Europe to assume “a peaceful future.” In 2024, the company announced plans to build four manufacturing plants in Ukraine.

The broader European defense sector has been expanding at roughly three times its pre-2022 pace, Financial Times reported in August. Western leaders claim the accelerated buildup is needed to meet NATO readiness targets, maintain arms deliveries to Kiev, and deter what they describe as a potential Russian threat.

Moscow has called such claims “absurd” fearmongering aimed at justifying increased military spending and condemned what it calls the West’s “reckless militarization.”

Ukrainian, American and European officials met in Switzerland Sunday after a US proposal to end Russia’s almost four-year invasion was widely criticised as heeding to Moscow’s demands.

All sides claimed progress negotiations in Geneva, with a joint statement calling them “constructive.”

EU leaders are expected to hold emergency Ukraine talks on the sidelines of a summit in Angola later on Monday.

“In the steps we have coordinated with the side of the US, we’ve managed to keep extremely sensitive points,” Zelensky told a conference in Sweden, speaking via video link.

These included “the full release of all Ukrainian prisoners of war under the all-for-all formula and civilians, and the complete return of Ukrainian children abducted by Russia.”

Kyiv has throughout the war announced that Russia had illegally taken Ukrainian children from occupied territories into Russia, seeking their return.

“These are important steps, but to achieve real peace, more, more is needed,” Zelensky said.

He added Ukraine stands at a “critical moment” and vowed to look for “compromises that strengthen but not weaken us.”

A 28-point US proposal last week spooked Europe, as it provided Moscow to gain even more territory that it occupies, with many in Kyiv and the EU seeing it as effective capitulation to Moscow.

Russian President Vladimir “Putin wants legal recognition for what he has stolen,” Zelensky continued.

The Kremlin said Monday it was not informed on the results of the Geneva talks.

Spokesman Dmitry Peskov stated Moscow was aware that “adjustments” were made to the plan that was initially endorsed by Donald Trump and welcomed by Putin.