Diageo, Burberry rally after Trump tariff ruling

Shares in two of the FTSE 100’s biggest retailers, Burberry and Diageo, saw a significant surge on Friday afternoon following the news that President Trump’s global tariff regime had been struck down by the top US court. This decision has been met with great relief and optimism by investors, as it means that the threat of a trade war between the US and its major trading partners has been averted.

Burberry, the luxury fashion brand, saw its shares rise by 3.2 per cent to 1,212p, while Diageo, the world’s largest producer of spirits, saw a jump of 3.9 per cent to 1,851p at the end of the day’s trading session. This positive response from the market is a clear indication of the confidence and trust that investors have in these two companies.

The decision by the US Supreme Court to strike down President Trump’s tariff regime has been welcomed by businesses and economists alike. The tariffs, which were imposed on steel and aluminum imports from the European Union, Canada, and Mexico, had sparked fears of a global trade war and had caused uncertainty in the markets. However, with this ruling, the threat of retaliatory tariffs from these countries has been eliminated, providing a much-needed boost to the global economy.

Burberry, known for its iconic trench coats and signature check pattern, has a strong presence in the US market. The company had expressed concerns about the impact of the tariffs on its business, as it would have led to higher costs for its products. With the tariffs now off the table, Burberry can continue to focus on its growth strategy and expand its presence in the US market without any hindrance.

Similarly, Diageo, which owns popular brands such as Johnnie Walker, Smirnoff, and Guinness, also had concerns about the tariffs and the potential impact on its business. The company had warned that the tariffs could lead to higher prices for its products, which could ultimately affect consumer demand. With the tariffs now out of the picture, Diageo can breathe a sigh of relief and continue to focus on its global expansion plans.

The positive response from the market also reflects the strong financial performance of these two companies. Burberry recently reported a 3 per cent increase in its full-year revenue, while Diageo’s sales and profits have been on the rise. This, coupled with the removal of the tariff threat, has further boosted investor confidence in these companies.

The decision by the US Supreme Court has also been welcomed by the retail industry as a whole. The National Retail Federation, the world’s largest retail trade association, had strongly opposed the tariffs and had warned that they would lead to higher prices for consumers. With the tariffs now being struck down, retailers can continue to offer competitive prices to their customers, which is good news for both businesses and consumers.

In addition to the positive impact on the retail industry, the ruling by the US Supreme Court has also been seen as a win for free trade and global economic stability. The threat of a trade war between the US and its major trading partners had caused concern among businesses and governments around the world. With this threat now eliminated, there is hope for a more stable and prosperous global economy.

In conclusion, the decision by the US Supreme Court to strike down President Trump’s global tariff regime has been met with great enthusiasm by investors and businesses. The rally in shares of Burberry and Diageo is a clear indication of the positive impact this ruling will have on the market. With the threat of a trade war now eliminated, these two companies can continue to focus on their growth strategies and contribute to the global economy. This ruling is not only a win for these two retailers, but also for the retail industry and the global economy as a whole.