Bae systems, rolls-royce and babcock shares surge in ftse 100 defence stock boom

Shares of FTSE 100 heavyweights Rolls-Royce, BAE Systems and Babcock have rallied following the UK government's unveiling of its strategic defence review. The comprehensive 130-page

report, which proposes constructing up to 12 new nuclear-powered attack submarines, emphasises the necessity for the UK to prepare for potential conflicts in Europe or the Atlantic and shift

towards "war-fighting readiness" in response to Russian hostilities, as reported by City AM. Babcock's shares soared by over seven per cent today, eclipsing the 1,000p

threshold for the first time since late September 2016. BAE Systems also witnessed a near two per cent enhancement in share value, with its stocks currently trading at 1,937p apiece.

Rolls-Royce experienced the most modest climb among these titans of the London Stock Exchange's blue-chip defence sector, with its share price rising just 0.35 per cent in the wake of

the defence review. Nevertheless, this uptick extends Rolls-Royce's impressive trajectory that has prevailed since the Covid-19 outbreak, only briefly hampered by US President Donald

Trump's 'Liberation Day' tariffs announcement. Now having fully rebounded from the resultant share price dip, Rolls-Royce last month saw its valuation soar above £70 billion

for the first time in its history. SHARES RISE THANKS TO £15BN PLEDGE The collective share prices of the trio have benefited from the government's commitment to a £15 billion investment

in upgrading the UK's armed forces. Other declarations include plans to construct up to 7,000 long-range weapons such as missiles or drones, alongside a £1.5bn pledge to build six new

factories. The Ministry of Defence (MoD) anticipates that the construction of these new submarines will sustain 30,000 jobs into the 2030s, in addition to providing 30,000 apprenticeships

and 14,000 graduate roles over the forthcoming decade. The review was spearheaded by former Labour defence secretary Lord Robertson, culminating in a total of 62 recommendations. LIKE THIS

STORY? WHY NOT SIGN UP TO GET THE LATEST BUSINESS NEWS STRAIGHT TO YOUR INBOX.