Tech Stocks Surge on Merger Talks and Upbeat Outlook

Technology stocks experienced a significant boost Wednesday, with Sybase Inc. shares rising nearly 50% after reports emerged of a potential merger with SAP AG. Meanwhile, IBM Corp. issued a long-term outlook, pledging to double its earnings to at least $20 a share by 2015. Other notable gains were seen in Apple Inc., Cisco Systems Inc., and Intel Corp.

Key Takeaways:

• Sybase shares surged 50% before market close, and ended the day with a 35% gain at $56.14, after reports of a potential $6 billion acquisition by SAP AG.
• IBM shares rose more than 4% to close at $132.68, as the company outlined its plan to double its earnings to at least $20 a share by 2015.
• Apple Inc. shares traded up 2.2% to close at $262.09, amid reports of China Unicom's plans to subsidize the purchase of iPhones and other 3G handsets.
• Cisco Systems Inc. shares moved up 3% to close at $26.74, ahead of its scheduled third-quarter financial results release, which saw a 63% profit gain compared to the period last year.
• Video-game publisher Electronic Arts saw its shares fall 5.8% to close at $17.71, following its report of fourth-quarter results and fiscal 2011 forecast largely in line with previous expectations.
• Other big tech names closing with gains included Hewlett-Packard Co., Dell Inc., Intel Corp., and Microsoft Corp.

Statistics:

• The Nasdaq Composite Index rose 2.1% to 2,425.
• The Morgan Stanley High Tech 35 Index gained 1.9%.
• The Philadelphia Semiconductor Index rose 2.8%.
• Sybase shares ended the day at $56.14 following a 35% gain.
• SAP's U.S.-traded shares closed at $44.90.
• IBM's earnings are expected to double to at least $20 a share by 2015.

Sources:

• Bloomberg News
• Wall Street Journal
• Contify.com
• Euclid Infotech