The FTSE 100 closed higher yesterday after British defence stocks rallied across the board following Norway’s record-breaking order of British-made warships and a top stockbroker handed Babcock an upgrade.
Gold mining stocks also benefited as gold pushed towards a new all-time high of more than $3,500 per ounce.
Shares in BAE Systems rose by nearly two per cent after the Ministry of Defence (MoD) confirmed the Nato member had placed an order for five of the arms manufacturer’s anti-submarine warships worth some £10bn.
The commission for the Type 26 Frigates is the UK’s largest ever warship export deal by value, and promises support 4,000 jobs in the UK “well into the 2030s”, the defence ministry claimed.
BAE Systems’ valuation has risen by over 55 per cent so far this year, while Chemring and Rolls-Royce have ballooned by 67 per cent and 93 per cent respectively.
But the sector’s biggest publicly listed riser has been Babcock, whose share price has more than doubled in 2025.
It made further gains on Monday after it was handed a chunky upgrade by a star analyst at Peel Hunt for hitting its earnings forecast a year early.
The investment bank raised its target price for the recently anointed FTSE 100 constituent from 828p to 1,119p. It reiterated its ‘buy’ rating, citing the transition “from decades of cost-down to output-based budgets”.
Overnight gold prices surged to a record high above $3,500 as investors looked to the yellow metal as a safe haven a