P.M. BRIEFING : Defense Stocks Fall in London
- Share via
LONDON — Stocks of defense-related industries plunged on the London International stock exchange today in response to the British government’s announcement it will slash an estimated $1.03 billion from the military budget.
Defense Procurement Minister Alan Clark said in Parliament late Monday that inflation had placed extraordinary pressure on the military’s running costs, prompting that $1.03 billion be trimmed from the $36.25-billion defense budget.
The government also said the cuts were due to the easing of East-West relations.
Hardest hit by the news was British Aerospace, which lost a $906-million order for 33 Tornado fighter-bombers. British Aerospace stock tumbled 37 cents a share to $8.60, but managed to stage a slow recovery around midday.
Setbacks were suffered by other companies linked to the manufacture of Tornadoes, a nuclear-capable aircraft designed for attacking the Soviet Union. Tornadoes are built in the northwestern English town of Warton in cooperation with Italian and West German firms.
Sign up for Essential California
The most important California stories and recommendations in your inbox every morning.
You may occasionally receive promotional content from the Los Angeles Times.
