FTSE 100 Live 04 February: Index seen lower amid trade turbulence, Guinness owner Diageo post results
FTSE 100 Live 04 February: Index seen lower amid trade turbulence, Guinness owner Diageo post results
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Drinks giant Diageo today reported a return to sales growth but warned that US tariffs could impact the company’s “building momentum”. It has also removed medium-term guidance due to macroeconomic and geopolitical uncertainty in many of its key markets. Organic net sales increased 1% in the six months to 31 December, reflecting price and mix after a 0.2% volume decline. Reported operating profit declined 4.9%.
In North America, Diageo said it outperformed the market driven by the strong performances of Don Julio and Crown Royal. Guinness delivered double-digit growth for an eighth consecutive half. On tariffs, chief executive Debra Crew said: “Diageo has anticipated and planned for a number of potential scenarios regarding tariffs in recent months. “The confirmation at the weekend of the implementation of tariffs in the US, whilst anticipated, could very well impact this building momentum.
“It also adds further complexity in our ability to provide updated forward guidance given this is a new and dynamic situation. “We are taking a number of actions to mitigate the impact and disruption to our business that tariffs may cause, and we will also continue to engage with the US administration on the broader impact that this will have on everyone supporting the US hospitality industry, including consumers, employees, distributors, restaurants, bars and other retail outlets.”.
US markets recovered some of their earlier losses last night after Donald Trump announced a month-long pause on Mexico’s 25% tariffs. The Dow Jones Industrial Average finished 0.3% lower, while the S&P 500 fell 0.8% and the tech-focused Nasdaq Composite lost 1.2%. London’s blue-chip index dropped 90 points to finish the day at 8583, or a 1% fall, marking its steepest one-day drop of 2025 so far. Canada tariffs have also been postponed for a month but with China announcing retaliatory action as additional 10% US tariffs come into force today.
