London, Jan 17, 2026, 08:50 GMT — Market closed
- Shares of BAE Systems jumped 2.3% to 2,088p on Friday, outperforming the flat FTSE 100.
- The defence group revealed a new purchase of 160,000 shares for cancellation.
- Traders are eyeing weekend Ukraine updates and U.S. contract activity ahead of BAE’s February 18 earnings report.
BAE Systems plc (BA.) shares closed Friday up 2.3% at 2,088p, outperforming a flat FTSE 100 as the weekend approached. Trading volume hit 5.6 million shares, below the 50-day average, indicating a sentiment-driven push rather than heavy liquidity demand. 1
London has closed, but Friday’s action holds weight as defence stocks are increasingly a shortcut for investors betting on geopolitics and government budgets. BAE is also trimming its share count with buybacks, a tactic that can boost earnings per share even if revenue growth slows.
That combination has the power to transform a quiet Friday into a signpost for the coming week. Once markets resume, traders will see if the defence premium can stand firm without new news driving it.
In a regulatory filing, the company revealed it repurchased 160,000 shares on Jan. 15 at a volume-weighted average price (VWAP) of 2,041.24p per share and plans to cancel them. This buyback was carried out via Morgan Stanley as part of the second tranche of its buyback programme. 2
A separate filing revealed CEO Charles Woodburn, CFO Bradley Greve, and other senior executives purchased “partnership” shares at £20.532 apiece on Jan. 14 under the company’s share incentive plan. The notice also noted matching shares granted at no cost, a typical element of employee share schemes. 3
Defence shares led gains on Friday after the Russia-Ukraine conflict grabbed attention again, following Ukrainian President Volodymyr Zelenskiy’s state of emergency declaration and Britain’s £20 million energy aid commitment, Reuters reported. The FTSE 100 edged down 0.04%, but BAE and rival contractor Babcock managed to climb. 4
BAE Systems Inc announced it secured a $62 million contract from the U.S. Navy to establish a depot capability in San Diego. The facility will handle testing, troubleshooting, and repairs of the AN/APX-122A interrogator found on the E-2D Advanced Hawkeye aircraft. “This onsite maintenance center will enable the Navy to enhance mission readiness and platform availability,” said Damon Brady, BAE Systems’ director of Tactical Systems. The AN/APX-122A is part of the IFF (identification friend or foe) system, which helps differentiate allied forces from potential threats. 5
The U.S. government announced in the Federal Register that Saudi Arabia has put in a request for 2,000 Advanced Precision Kill Weapon Systems. BAE Systems Inc. is listed as the main contractor for the potential $100 million deal. While these notices don’t confirm a contract, traders often see them as an early signal for possible future orders. 6
Contract flow in the U.S. is crucial for BAE, given that many of its programmes span years and steady visibility often outweighs short-term fluctuations. When geopolitical tensions rise, the market usually values that consistency, but it can turn harsh when sentiment shifts sharply.
But the defence trade can flip just as fast. A hint of easing in Ukraine or any hold-ups in procurement and approvals could cool the sector sharply — and buybacks won’t patch up programme delays down the line.
When London opens on Monday, Jan. 19, traders will focus on weekend Ukraine developments and any fresh news on buybacks or U.S. contracts. The next key date is Feb. 18, when BAE will release full-year results and provide updates on guidance and cash returns. 7
