Rolls-Royce Holdings PLC (LSE:RR.) shares surged to a record high on Wednesday as Donald Trump’s election win over Kamala Harris sent defence stocks higher.
Shares were up 4.2% at 583.60p in the wake of the news, having climbed to an all-time high of 590.6p earlier on in the morning.
BAE Systems PLC (LSE:BA.) also jumped by 4.7% to 1,340.50p on Wednesday, with the duo sitting among the most exposed London-listed companies to the US.
This came as fears over sweeping import tariffs under Trump appeared to be offset by the former president’s likely commitment to hiking defence spending.
Analyst Garry White at Charles Stanley noted Trump is expected to boost military spending and has proposed plans for "the installation of an iron dome-style defence for the whole country".
Further tax cuts and deregulation are also expected under a second Trump presidency, said Ben Lofthouse, fund manager at Henderson International.
Ashtead Group PLC (LSE:AHT), Barclays PLC (LSE:BARC) and Intercontinental Hotels Group PLC (LSE:IHG) also emerged as winners among London's blue chips as a result of their exposure to the US.
For banks, Trump’s likely win had brought a “goldilocks scenario”, said Scope Markets analyst Joshua Mahony, as new tariffs were unlikely to stretch to the sector, while interest rates are expected to remain high as his policies are seen as inflationary.
Ashtead, which hires out construction equipment, is set to be "a direct play on hammers and tools pounding away across the country" as Trump turns to boosting the US construction industry, added AJ Bell analyst Russ Mould.