March 18 - Summary: Stocks rally as Russia's Vladimir Putin says he won't go beyond Crimea; Oracle struggles to catch up to the cloud; Microsoft hits July 2000 high on speculation Office is headed to the iPad. Conway G. Gittens reports.
Traders on Wall Street breathed a sigh of relief when Russian President Vladimir Putin said that after Crimea, he doesn't want any more of Ukraine. That upped stocks, with sectors tied to the pace of economic growth leading the S&P 500 within one percent of record levels. After the close - Oracle announced profits excluding items and sales that were below consensus. Oracle is still being hurt by its slow shift to the cloud. A new era for Microsoft? A source says the company may unveil an iPad version of Office on March 27. Some media reports say Microsoft will launch a free version with limited functionality and fully-featured version that requires a paid subscription to Microsoft Office 365. Analysts say the lack of an iPad version has robbed Microsoft of $2.5 billion in annual revenues. Shares of Microsoft flirted with dotcom-boom levels, hitting a July 2000 high. Wal-Mart Stores will accept games for popular consoles like the Sony PlayStation3 and Microsoft Xbox 360, and let customers in return buy anything at Wal-Mart and Sam's Club, both in-store and online. That news gave Wal-Mart's stock a slight bump higher, but sent GameStop shares to a 3.4 percent decline. Investors were looking ahead to the end of a two-day meeting of the U.S. Federal Reserve, which began Tuesday. Stewart Taylor, portfolio manager at Eaton Vance, says he would like to hear that quantitative easing is coming to an end, but instead, Fed Chair Janet Yellen is likely to be less dramatic. SOUNDBITE: STEWART TAYLOR, PORTFOLIO MANAGER, EATON VANCE (ENGLISH) SAYING: "You're going to hear the same 'data dependency' that has characterized her past statements, the past Fed statements, and I don't think there's going to be a big change. I think the bar for ending this tapering of the taper, so to speak, is very, very high and, while I don't think the economy is in remarkable shape, like it seems a lot of economists think, it's not in bad shape." In the latest economic data, consumer prices rose 0.1 percent in February with a drop in energy costs offsetting the biggest surge in food prices in almost 2-1/2 years. Meanwhile, new housing construction projects slowed for a third month in a row. In Europe, Putin's comments were helpful enough to shift equities out of negative territory.