Increased spending on UK defence is unlikely to be affected by whoever wins the Tory party election race, according to analysts at US bank Citi.
“We do not believe there are any candidates who pose a clear negative to UK defence spending,” said the broker in a note.
“In general, the rhetoric has been notably pro-defence and we believe that the number of candidates who are talking up defence spending increases is incrementally positive for the UK Defence outlook.
“Penny Mordaunt, Liz Truss and Tom Tugendhat have all made recent statements that are clearly in favour of strengthening UK defence capabilities.
“The UK has recently made a commitment to spend 2.5% of GDP on defence by 2030. We see it as unlikely, though not impossible, that any of the candidates would overturn this commitment.”
Shares in BAE Systems PLC (LSE:BA.) eased 1.5% to 797.2p and Rolls-Royce PLC by 2.4% to 86.4p, despite the Citi comments.