UK Stocks Rise as Defence and Energy Lead Gains Amidst Global Trade Tensions

Britain's benchmark FTSE 100 index edged higher on Tuesday, bolstered by gains in defence and energy stocks. The slight rise comes after the government announced a substantial increase in defence spending, propelling aerospace and defence shares to peak levels.

Prime Minister Keir Starmer's announcement of the largest post-Cold War defence budget increase sent the sub-index soaring 2.5%, while oil giants Shell and BP saw shares lift alongside climbing crude prices. A backdrop of U.S. trade tensions looms, following President Trump's tariff hike on steel and aluminium.

Challenges persist as industrial and precious metal miners dropped over 1% amid falling copper and gold prices. The OECD revised its global economic growth outlook downward, citing intensified impacts of the trade war on the U.S. economy. Investors remain wary of fiscal strategies ahead of Rachel Reeves' financial roadmap presentation.

(With inputs from agencies.)