British engineers Melrose Babcock hit by trade and recession fears
Published: 09:56 07 Apr 2025 BST
Melrose Industries PLC (LSE:MRO, OTC:MLSPF) and Babcock International PLC (LSE:BAB) shares both dropped 8% in early Monday trading, as fears of a global recession triggered by President Trump’s sweeping tariffs sent shockwaves through industrial stocks.
The two engineering groups, which export a significant share of their output, are particularly exposed to disruptions in global trade and investment.
Melrose, through its GKN Aerospace division, supplies components to global aircraft manufacturers such as Airbus and Boeing, with operations spread across Europe, North America and Asia.
Babcock, meanwhile, delivers defence and engineering services not just in the UK but also to countries like Australia, Canada and South Africa.
Both rely heavily on international contracts and global supply chains.
Trump’s tariffs have raised the risk of retaliatory measures and cross-border friction, threatening project pipelines and cost stability.
For companies dependent on export markets and capital investment, a slowdown in global demand could lead to project delays, reduced orders and pressure on earnings.
