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Global Rally Continues: Germany Hits New High

A financial trader uses a telephone as he monitors data on his computer screens in front of a display of the DAX Index curve at the Frankfurt Stock Exchange.
Ralph Orlowski | Bloomberg via Getty Images
A financial trader uses a telephone as he monitors data on his computer screens in front of a display of the DAX Index curve at the Frankfurt Stock Exchange.

Germany joins the U.S. at an historic high. France at a two-year high. Portugal at 52-week high. Japan at five-year high.

Early in trading the Dow Jones Industrial Average crossed above 15,000 to hit an all-time intraday high of 15,013.43. Caterpillar and JPMorgan led the blue-chip gainers. (Read more here)

European bank earnings continue to be fairly strong, with Societe Generale, HSBC, and Commerzbank all up. Barclays, Credit Suisse, other European banks are trading higher in the U.S.

Elsewhere:

1) Reports that Microsoft is preparing an about-face on Windows 8 is all the talk among tech traders this morning. The company appears to be admitting that updating to a touchscreen interface and burying the traditional "desktop" launch has alienated users and greatly steepened the learning curve for the new system.

Microsoft has had one unalloyed success in recent years: the Xbox. But it hasn't been able to integrate that success on other platforms, such as PCs or smartphones.

This is Microsoft's fatal flaw: After essentially inventing the modern PC operating system, it has been unable to come up with a single great category killer that combines hardware and software, as Apple has done.

In theory, it has the right ingredients: It sells a lot of different products, it has multimedia content, and the Xbox has a large subscription base.

Those are necessary, but not sufficient, conditions. Microsoft just can't seem to integrate the products the way Apple has. And Microsoft is stunningly slow in innovation. It has been late to the smartphone business (its partnership with Nokia) and the tablet business (Surface).

And now its greatest product, Windows, is facing a major update. Apparently, it may look like the old Windows. The update is called Windows Blue. That is no doubt the right color to describe Steve Ballmer's mood.

What about the recent rally in Microsoft shares? There's no doubt the market liked the recent earnings ... the stock is up about 17 percent since reporting earnings on April 18. But there is a new Xbox coming that is generating some excitement.

And please note, the entire tech sector has rallied since then. Tech is the leader among the 10 S&P 500 sectors, up 8 percent since April 18. And Microsoft isn't the tech leader: Seagate Technology is up 24 percent, Western Digital up 18.6 percent, Apple is up 17 percent.

2) Emerson, which provides power systems, motors, and industrial machinery, missed on top and bottom line and cut its 2013 earnings per share estimate, as well as lowering its sales growth estimate to 1.5 percent to 2.5 percent, from 2 percent to 5 percent. Its report was unusually downbeat.

A turnaround in the second half? Not here: "We do not see a catalyst to economic growth over the next six to nine months." Ugh. Sales in Europe—about 20 percent of revenues—were down 3 percent. The one bright spot: U.S. residential air conditioning, with 23 percent growth, a beneficiary of the improving housing market.

By CNBC's Bob Pisani

  • A CNBC reporter since 1990, Bob Pisani covers Wall Street from the floor of the New York Stock Exchange.

Wall Street