Rolls-Royce, Babcock shares jump on Healey’s defence borrowing plan

Defence stocks were handed a boost on Monday morning following reports that Chancellor John Healey was set to borrow billions to invest in the military at the forthcoming Budget. Rolls-Royce was up nearly two per cent in early trading to 1,184.40p, while Melrose was up 1.4 per cent. Both are key players in aerospace and operate at different areas in the supply chain on flight technology. Shares in warship builder Babcock rose 2.6 per cent to 964p, while fighter jet maker BAE s stock was up 1.7 per cent to 1,963p. It comes as Healey is tipped to announce extra funding for defence through the use of public finance institutions (PuFins) at the Budget. The chancellor is set to use the National Wealth Fund and British Business Bank to borrow cash for defence, without using breaching the government s fiscal rules. Christmas has come a little earlier for the defence sector thanks to John Healey. While this isn t the 1930s-style rearmament many say is needed, it should be a si