Although we don't believe in timing the market or panicking over daily movements, we do like to keep an eye on market changes -- just in case they're material to our investing thesis.
Explosive news out of Microsoft (NASDAQ:MSFT) has sent the stock soaring today, knocking out what's been an otherwise lackluster day from the markets. The stock's blown away the Dow Jones Industrial Average (DJINDICES:^DJI), which has gained around 20 points as of 2:15 p.m. EDT after an up-and-down morning kicked things off. Outside of the tech company, blue chip stocks are fairly evenly mixed between risers and losers on the day. Let's get caught up on all the action you need to know.
Ballmer's big news
Microsoft unloaded a bombshell this morning when CEO Steve Ballmer, the company's leader since taking over for Bill Gates back in 2000, announced he will retire within the next 12 months. The company has no successor in place now, but Ballmer said he'll stick around until one's found. Investors rallied on the news, propelling Microsoft's stock higher by an astronomical 7.1%.
Ballmer's been a Microsoft mainstay for years, having joined the tech leader way back in the 1980s. However, shareholders have grown antsy with his tenure lately as Microsoft's misfired on several major attempts to innovate. The firm's Surface tablets notably failed to impress: The tablet generated only $853 million in revenue since the start of the year, according to the company's most recent quarterly filing, and Microsoft's absorbed a number of costs as it's had to lower prices.
Microsoft's also faced tough competition in that time, and Ballmer's attempts to fight back haven't gone quite as planned. The Surface itself failed to compete against Apple's iPad and other tablets -- the Surface's sales in 2013 didn't even hit 5% of the more than $25 billion that the iPad rang up over that time. Coupled with the lackluster launch of Windows 8 (and the older flop of Windows Vista, which also released under Ballmer's tenure), perhaps today's stock surge is the sign that Microsoft needs to take a fresh new direction on its leadership. Ballmer's had some successes, but it hasn't been enough to keep Microsoft ahead of its fast-charging rivals in the tech world.
Outside of Microsoft, Home Depot's (NYSE:HD) having a tough day on the other side of the Dow. The home improvement retailer's stock has fallen 0.7% to lead the Dow's contingent of laggards lower. Home Depot's performance is heavily tied to how the ups and downs of the housing market, and bleak news out of new home sales today has pared investor optimism.
New home sales for July fell more than 13% since June to plunge to the lowest rate of sales since October. Still, it's important to keep the housing market's overall rebound in perspective: Today's report was a big drop from June, but year-over-year new home sales were still up 6.8%. The housing market's going to suffer some bumps and hurdles as it works its way back from its lows, and as long as it keeps its upwards trajectory over time, Home Depot will be one of the best plays you can buy on this rebounding sector.