The FTSE MIB rose to around 53,000 on Tuesday, extending its recent advance near record highs, mainly driven by continued strength in defence stocks.
Sentiment remained supported after NATO announced a series of multi-billion-euro military projects aimed at strengthening the alliance's defence capabilities, fueling expectations of higher military procurement across Europe.
Leonardo rose 1.8%, while Fincantieri and Avio advanced 4.1% and 2.6%, respectively.
Automakers also traded higher, with Ferrari gaining 1.1% and Stellantis rising 2.1%.
Meanwhile, oil major Eni added 1.1%, tracking higher crude prices after reports that an LNG carrier was struck by a projectile near the Omani coast while exiting the Strait of Hormuz.
On the flip side, tech stocks weighed on the index, with STMicroelectronics (-4.3%) and Prysmian (-1.8%) declining as caution from the Asian session lingered after Samsung Electronics' strong guidance prompted investors to reassess lofty AI-driven valuations.