Cheers for Diageo as some fizz returns to sales and shares lift 5% in early trade

Susannah Streeter, chief investment strategist at Wealth Club, said: “There’s a bit more fizz returning to Diageo with flat first-half sales replaced with a bit more sparkle.

“Net sales were up 2.3 per cent for the quarter compared to a year ago, providing cheer to shares in early trade.

“Although there’s no change to the guidance, better performances in Europe, Latin America and Africa have added a bit of zing to the picture and a cause for celebration.

“There was a seasonal lift due to the early arrival of Easter and there are also some tentative signs that a frenzy of World Cup fever will keep spirit demand higher.

“However, the hangover from the tariff effects is lingering with North America sales still proving a headache at a time when demand was already weaker.

“Americans aren’t hitting premium brands in the same way, potentially due to trading down but also competition in the market from domestic names.

“It means that the full year still points to a contraction but with the tone a little more positive about the outlook, with cost savings on track, a glass half full attitude is starting to return.”