Huge Day for Yacrosoft

It can be hard to get work done when Google and Microsoft report earnings after the bell. The country is looking to both of these companies to give a pulse reading on our troubled economy. Will Microsoft mirror the positive results from Intel, which point to a strong PC market? Will Google show immunity from economic downturn, or will it signal a slowdown in the online ad market?

As for Microsoft, I am encouraged by Intel's indication of a robust market, but the 21% growth expectation for this quarter seems a little too lofty for comfort. Even though Microsoft seems to be trading cheaply lately, I wouldn't recommend buying before the earnings announcement.

Google, in my estimation, has a better chance of meeting--if not exceeding--expectations. According to Mark Mahaney of Citigroup:

"Companies spent more money on search advertising in the second quarter than in the first, and they continued to plow the lion's share of their ad dollars into Google."

If this is true, Google should expect to improve on last quarter's $4.84 per share, barring an undue increase in spending. More importantly, Google should greatly exceed the more conservative $4.74 per share that analysts are currently expecting.

Bottom line: You should have some of your portfolio in Google for the long haul, and perhaps increase your position before the closing bell if you have the guts.