Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
It's another strange day on Wall Street, but what else should we expect at this point? Economic data out today showed improved GDP growth (3.6% in the third quarter) and the second-lowest initial jobless claims figure since 2009 (298,000 last week), but the Dow Jones Industrial Average (DJINDICES: ^DJI ) is off 0.38% in late trading.
The drop was caused by fear of the Federal Reserve slowing its $85 billion per month bond-buying program, which could happen as early as this month. At the end of the day, pulling stimulus from the economy would be a good thing, but short term the market often loses sight of that.
One stock that isn't helping the Dow today is Microsoft (NASDAQ: MSFT ) , which ironically was the best stock in the index yesterday.
Microsoft has fallen 2.8% today after Ford (NYSE: F ) board member Edsel Ford II said "Alan is staying [at Ford] through the end of 2014." There had been hope that CEO Alan Mulally would jump ship to revive Microsoft's stagnant business.
Was Mulally really the savior?
The hope from Microsoft's perspective is that Mulally could perform the kind of magic on Microsoft that he did with Ford, but they're very different businesses. Mulally spent most of his career at Boeing, where he got a foundational manufacturing background. That transferred well to Ford, where he was an auto industry outsider but not entirely new to labor negotiations, supplier networks, and manufacturing.
Microsoft would be a different world. It is primarily a software company, and that's way out of Mulally's wheelhouse. While he may have been a popular, high-profile name, Mulally's background alone suggests he probably wouldn't be the best person to lead Microsoft.
Microsoft needs its own Mulally
Finding a leader like Mulally would be great for Microsoft, but the fit for Ford's Mulally is a stretch. So while the stock may falter on a day when it appears Mulally won't join Microsoft, long-term shareholders should probably see it as a good sign.
Investors should really be hoping that Microsoft can find its own Mulally.
Keep your eyes on the prize
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