Markets in the US continued to march higher as technology stocks led the way thanks in part to Microsoft’s strong earnings report. The Dow closed the day at another high gaining 36 to 18,595. Trading volume was higher on the day indicating that big investors were jumping into the pool.
Microsoft shot higher after announcing solid earnings and erasing the accumulated ill effects of the prior years of the “Steve Ballmer” leadership. Revenue was up 2% and net income gained 11% as both top and bottom lines beat expectations. "Multinationals choose us because we are the only hybrid and hyperscale cloud spanning multiple jurisdictions," CEO Nadella said. "We cover more countries and regions than any other cloud provider, from North America to Asia to Europe to Latin America." Going forward Microsoft was optimistic about its cloud business.
Gold pulled back dropping $16.80 an ounce to $1,313 as strength in the US dollar and stability in global markets put a lid on the gold bugs. Oil was up thirty cents a barrel with WTI crude priced near $45 a barrel. Baker Hughes reported earnings and in doing so expects the US rig count to increase as prices have stabilized in the $45 to $50 range.
Europe continues to rest in relative calm. The next big test of the EU is the Italian banking crisis which should come to a head in a few weeks. Turkey continues to move toward a more belligerent stance as it continues to round up and demand extradition of Erdagon critics who are also supporters of a sectarian gubment. Turkey, as a part of NATO, is critical in the region since it has close to one million men who are armed to the teeth with high quality German and US weapons. If Turkey distances itself from the EU and jeopardizes its status as a major NATO player, it could change the dynamics of the region significantly and could be the start of a major east/west clash of cultures. The US is looking better all the time in light of the things unfolding in Europe and the Middle East.