European markets traded higher on Monday, amid a charge in defense shares after regional leaders held security talks that touched on bolstered military spending. Elsewhere, euro zone inflation data encouraged expectations that the European Central Bank will cut interest rates when it meets on Thursday.
Euro zone inflation dipped to 2.4% in February, slightly above analyst expectations. Meanwhile, the euro zone purchasing managers’ index showed that a contraction in the bloc’s manufacturing sector had eased to its least severe level in two years.
On Tuesday, earnings are set to come from Continental, Thales and IWG, and data releases include the latest European unemployment figures.