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Good News from Europe after Ireland Auction

Thursday, 26 Aug 2010 | 10:31 AM ET

Futures moved up 5 points as weekly jobless claims of 473,000 was a bit better than consensus of 485,000. Continuing claims of 4.456 million were also lower than consensus of 4.515 million.

Europe is up today (a rarity this month), as Ireland sold several hundred million euros worth of treasury bills at yields of 1.978 percent, well below the 2.458 percent of just two weeks ago. (See PIIGS nations' credit-default swaps here.)

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Bob Pisani reports on the trading day from the NYSE.

Speaking of Europe, alcohol producer Diageo (think Smirnoff, Guiness, Johnnie Walker, Bushmill's, Crown Royal, J&B, Seagram's, Gordon's, Ketel One, Jose Cuervo, Tanqueray, Captain Morgan, Baileys, Harp, Red Stripe, Beaulieu...I know way too much about this company) was down about 2 percent pre-open, reported organic profit growth of 2 percent for its fiscal year 2010 just ended, about in line with the lower end of guidance but still a disappointment to the Street, many of which were expect ing 3 to 5 percent growth.

Latin America, Africa and Asia saw growth, but demand still weak in Europe and North America.

Guidance for FY 2011 is for operating profit growth better than 2 percent. But with North America still contributing about 40 percent of the profits, even that lackluster guidance may not be a slam dunk.

They announced a 6 percent increase in the dividend (their current yield of 3.51 percent is pretty good), but that is not enough to create much excitement.

Elsewhere:

1) 3Par falls 3 percent to $26 after the data server firm announced it has accepted Dell's increased offer of $1.6 billion for the company. The new deal will give 3Par shareholders $24.30/share in cash, up from Dell's earlier offer of $18/share and $0.30 more than Hewlett-Packard's competing bid. However, the revised offer fell short of the $29 bid many shareholders and analysts had expected.

2) Guess falls 7 percent after its outlook disappointed the Street. Despite beating estimates in the last quarter ($0.72 vs. $0.68 consensus), the denim/apparel maker sees full-year earnings of $2.80-$2.85, short of $2.92 consensus. CEO Paul Marciano notes that "economic conditions remain uncertain in many markets around the world and consumer behavior remains cautious."

3) Jo-Ann Stores Q2 earnings far exceeded expectations ($0.20 vs. $0.02 consensus) as margins expanded and same-store sales rose 4.4 percent.

The fabric retailer raised its full-year earnings and sales guidance. 2010 earnings are now seen between $3.20 and $3.35 vs. $3.23 consensus as margins improve, while comps are now forecast up between 3.0 percent and 4.0 percent.

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  • A CNBC reporter since 1990, Bob Pisani covers Wall Street from the floor of the New York Stock Exchange.

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