Diageo update adds to drag on the Footsie

Market report Perry Gourley

A cautious trading update from Diageo, Scotland’s biggest whisky distiller, contributed to the Footsie dipping ahead of the Fed’s policy update.

The group behind Johnnie Walker whisky and Smirnoff vodka warned over a hit to sales from a ban on alcohol near motorways in India.

Shares closed down 2.78 per cent, or 69.5p, at 2,426,50 while the FTSE 100 ended the day down or 3.3 points at 7,271.95.

The index was also impacted by the pound heading towards 15-month highs against the US dollar following stronger than expected UK retail sales data.

Sales rose 2.4 per cent in August compared to a year earlier, easily beating economist expectations for a 1.1 per cent rise. On a month-onmonth basis, sales jumped 1 per cent, beating forecasts for a much smaller increase of 0.2 per cent.

David Madden, a market analyst at CMC Markets UK, said:“it is encouraging to see a sharp spike in consumers’ willingness to spend money.

“Despite the pullback in the pound this afternoon, the broader upward trend in the pound is still intact.”

Shares in Mitie dropped 1.5p to 256.8p after it confirmed that it was axing around 480 jobs as part of its turnaround plan and also warned over higher-than-expected costs linked to its overhaul.

Shares in Domino’s Pizza Group jumped 18p to 293.1p after announcing the launch of a £15 million share buyback programme. The DIY firm behind B&Q was in demand after reporting a rise in first half sales and said it is comfortable with its full year expectations, The ticketing technology firm said it performed in line with expectations in the first half of 2017 with a fall in profit despite a sales increase.