Panmure Gordon has reduced its rating on Allied Domecq. The broker lowered its recommendation to 'sell' with a 470 pence price target today (2 December).

In a note to clients gauging currency impact on the drinks sector, the broker reminded investors that the sliding dollar is "not good" for the spirits companies, adding that the US spirits sector appears to have become more cyclical. A weakening economy "could cause a drop in the growth rate," Panmure Gordon said.

The broker also cut its earnings forecasts for Diageo by 1.2%, keeping its 'hold' rating and 725 pence price target.