"The quicker we can get this sideshow out of the way, the quicker that investors can focus on the actual fundamentals," Jim Russell, senior equity strategist for US Bank Wealth Management, told Bloomberg. "It's critical because every day that we're hanging out there without the federal government being up in running, it damages the economy, it damages earnings, it damages investor confidence."
That's exactly correct, and the market has reacted favorably as optimism for a deal has risen over the last two days. The Dow Jones Industrial Average (^DJI 0.06%) hasn't given up any of its 2.2% gain from yesterday and is trading 0.6% higher as of 2:45 PM EDT. With a deal to end the shutdown seemingly closer to reality, here are the movers and shakers in the Dow today.
JPMorgan Chase (JPM 0.65%) is making big headlines after reporting a third-quarter loss of $380 million, or $0.17 per share. It was the first loss by JPMorgan under CEO Jamie Dimon and was the result of $9.2 billion -- $7.2 billion after taxes -- in costs to cover mounting litigation and regulatory probes. The pain looks to continue, although it should lessen in the coming years, and JPMorgan has set aside more than $28 billion in reserves for legal and regulatory costs since 2010.
Through all the mess, investors sometimes forget that Jamie Dimon has a hard-earned and well-deserved reputation as one of the best in the business. Under Dimon's leadership, JPMorgan made it through the financial crisis in impressive fashion. Despite the headwinds facing the company, it has managed to achieve reasonable profitability until this quarter, and it will be up to Dimon to get the company firing on all cylinders once its legal problems are in the rearview mirror.
Meanwhile, tech giant Microsoft (MSFT -1.84%) is approaching Steve Ballmer's retirement, set for no later than August 2014. In Microsoft's 38-year history, the company has had only two CEOs: Ballmer and co-founder Bill Gates before him. The board of directors has to make the tough decision between bringing an outsider with a fresh perspective and hiring talent from within. So far Ford has reiterated that its CEO Alan Mulally will remain with the Blue Oval through the end of 2014, and eBay CEO John Donahoe has declined to be considered, according to Bloomberg.
Regardless of who fills Ballmer's shoes, the new chief will certainly have his or her hands full. Microsoft's Windows OS business is in decline because of a multitude of factors including alternative operating systems and low-margin emerging-market sales. It's yet to be seen whether Microsoft's Windows 8 launch will provide a better product to compete with tablet and mobile devices. This will be key for investors to watch going forward.
