How Much Can Microsoft Corporation (MSFT) Move the Dow Jones Industrial Average (.DJI)?

Microsoft Corporation (MSFT)When economic news is mixed, quarterly results often make the difference for the stock market during earnings season. For those following the broad economy, today’s data didn’t give a clear signal. Pending home sales rose 1.5%, but the National Association of Realtors emphasized a sudden lack of inventory as holding back sales activity. This has mixed implications, including the potential for a faster rise in home prices but also an accompanying decline in home turnover and related business that results from sales.

Meanwhile, consumer income and spending both come in below expectations, with gains of just 0.2% suggesting that consumers aren’t entirely convinced that the recovery can continue even at its current pace. Still, the Dow Jones Industrial Average (Dow Jones Indices:.DJI) barely paused in its advance, rising 68 points by 11 a.m. EDT and pulling the S&P 500 up to within a couple points of a new all-time record.

Once again, Microsoft Corporation (NASDAQ:MSFT) was the big winner in the Dow Jones Industrial Average (Dow Jones Indices:.DJI), rising more than 2% and extending its recent gains to 13% in just the past week and a half. Despite ongoing skepticism about the prospects for its Windows 8 operating system, Microsoft Corporation (NASDAQ:MSFT) is benefiting from investors who see the stock as a value proposition. Hype about the coming new Xbox release could also refocus attention on the more successful gaming console business and raise awareness of the Microsoft Corporation (NASDAQ:MSFT) ecosystem, which has huge growth potential if the company can get more people to embrace it.

Beyond the Dow, SINA Corp (NASDAQ:SINA) has jumped 13.3% after announcing that Alibaba had bought an 18% stake in SINA Corp (NASDAQ:SINA)’s Weibo microblogging business. China’s answer to Twitter, Weibo has attracted a lot of attention from tech investors in the emerging market, and with Alibaba also getting options to potentially boost its Weibo stake in the future, Sina is clearly going to be a player in the rapidly evolving Chinese Internet industry.

On the downside, Nam Tai Electronics, Inc. (NYSE:NTE) has plunged 36% despite reporting sales that doubled from year-ago levels. Even though the company beat expectations, its guidance raised concerns that narrow margins might force Nam Tai Electronics, Inc. (NYSE:NTE) to shut down production of LCD modules. The news comes as a reminder that it’s important to look forward, rather than backward, in evaluating businesses releasing earnings.

The article How High Can Microsoft Take the Dow? originally appeared on and is written by Dan Caplinger.

Fool contributor Dan Caplinger has no position in any stocks mentioned. You can follow him on Twitter @DanCaplinger. The Motley Fool recommends SINA. The Motley Fool owns shares of Microsoft.

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