Defence Stocks Lead FTSE 100 Gains Amid Defence Spending Boost

FTSE 100 rose 0.1%, ending its losing streak with defence stocks benefiting from increased UK defence spending. BAE Systems and Rolls-Royce led the gains. Meanwhile, the FTSE 250 fell 0.2%, and consumers face higher energy costs as Ofgem raises its domestic price cap.

The FTSE 100 index posted modest gains on Tuesday, rising by 0.1% as defence stocks rallied following an announcement by Prime Minister Keir Starmer to increase defence spending. BAE Systems and Rolls-Royce led the charge with substantial increases in their share prices.

Smith+Nephew also provided a lift to the index, rising 6.1% on the back of annual results that aligned with market expectations. However, not all companies shared in the gains, as Unilever fell 1.3% after the abrupt departure of CEO Hein Schumacher.

Adding to economic concerns, UK households will face higher energy bills starting in April due to Ofgem's price cap increase, following unexpectedly high inflation figures. Meanwhile, the FTSE 250 index dipped 0.2%, led by a significant drop in CMC Markets' shares.

(With inputs from agencies.)