Berlin is planning to scrap a multi-billion-euro project to build F126 frigates. The F126 frigate programme has already cost taxpayers around €2.3bn.
Rheinmetall AG shares plunged Wednesday following the decision, falling as much as 16% in European morning trading. This decline means the stock has shed more than one third of its value since the start of the year.
The withdrawal from the key warships contract has dealt a blow to investor confidence in the defense contractor following years of huge gains. Rheinmetall and other European defense stocks fell for a second day, raising procurement concerns.