Stocks surged for the second straight day today, making last week's slide a distant memory, as remarks from Russian President Vladimir Putin calmed markets. Putin said he did not wish to seize further parts of Ukraine, but still defied Western protests by formally declaring Crimea as part of Russia. Investors, however, seemed to be glad that the crisis is contained to the peninsular region for now as the Dow Jones Industrial Average (^DJI -0.49%) finished up 89 points or 0.6%, and the S&P 500 approached its record high once again, climbing 0.7%.
In other macroeconomic news, housing data was positive as February housing starts at 909,000 were roughly in line with estimates, but building permits, a leading indicator for the sector, jumped to 1.02 million, well ahead of January's total of 945,000 and better than expectations at 955,000. Data also showed that last month's Consumer Price Index increased 0.1%, indicating that inflation continues to be under control.
Leading the blue chips' gains today was Microsoft (MSFT -0.10%), which jumped 4%, hitting $39.55, or its highest point since 2000. The jump came on rumors that the software giant would introduce a version of its Office suite. According to Reuters, new CEO Satya Nadella could make the announcement at a March 27 event. Investors reacted well to the news as Office is Microsoft's most profitable product, but the decision could undercut sales of Microsoft's own Surface tablet, which runs on Windows and comes with Office installed. Still, analysts estimate that the Windows-maker is forgoing $2.5 billion a year by not making Office for the iPad. Considering the Surface has undersold expectations, perhaps the iPad strategy is the better direction.
Elsewhere on the Dow, Wal-Mart (WMT 0.36%) said it wanted to get into the used video game business. The retail giant said starting March 26 it will allow customers to trade in used video games for credit on purchases at Wal-Mart and Sam's Club stores. Wal-Mart said it would refurbish the old games and sell them in "like-new condition." Investors did not have a strong reaction to the news, as used video games are just a $2 billion business, and Wal-Mart's entry is unlikely to be meaningful to its bottom line. Shares moved up just 0.1%, but when the world's largest retailer enters a new business there are bound to be consequences. Shares of GameStop (GME 2.09%), the No. 1 retailer of new and used video games, fell as much as 6% and finished down 3.4% on the news. The effects of Wal-Mart's are unclear, but GameStop benefits from a smaller store format that is often more accessible and staff specialized in video games. Considering Best Buy and Target already offer such programs, I wouldn't expect the move to have an immediate impact on GameStop.