European Staples to Be Affected by US Tariffs, With Spirits Impacted the Most, Morgan Stanley Says

MT Newswires Live2025-04-03

The US imposing a 20% tariff on the European Union and a 10% tariff on the UK will affect top players in the European staples sector, with spirits impacted the most, Morgan Stanley analysts said in a report Thursday.

London-based Diageo (DEO) estimated a $600 million yearly impact on operating profit from 25% tariffs on Mexico and Canada, the analysts said, adding that their model implies an almost 2% impact on its FY26 PBT forecast from tariffs imposed on EU and the UK.

For Pernod, the brokerage estimated an EU/UK tariff impact between 85 million euros ($94 million) and 90 million euros, implying up to a 4% impact on its FY26 PBT estimates.

According to the Wall Street firm, the impact of US tariffs on Nestle, Remy Cointreau, and Heineken's FY26 PBT could be 2%, 10%, and 2%, respectively.

Morgan Stanley said Anheuser-Busch Inbev could potentially benefit from the tariffs as extra charges could mean more expensive imported beer for the consumer, leading to improved market share for ABI in the US.

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