TECH STOCKS: Tech Stocks Cling To Small Gains In Afternoon

By Rex Crum

Technology stocks scratched out some small gains in afternoon trading Tuesday, but many sector leaders were still in the red and Applied Materials Inc. set a deal to acquire chip-equipment maker Semitool Inc.

Among leading tech stocks, gains came from Microsoft Corp. (MSFT), Cisco Systems Inc. (CSCO), Research In Motion Ltd. (RIMM), Hewlett-Packard Co. (HPQ) and IBM Corp. (IBM).

The tech-heavy Nasdaq Composite Index (RIXF) came back from earlier losses to edge up 1.3 points to 2,199, while the Morgan Stanley High Tech 35 Index (MSH) and the Philadelphia Semiconductor Index (SOX) lost ground.

Decliners included Apple Inc. (AAPL), Oracle Corp. (ORCL), IBM Corp. (IBM), Dell Inc. (DELL), EMC Corp. (EMC) and Intel Corp. (INTC).

Semitool (SMTL) shares soared $2.55, or more than 30%, to $10.95 after Applied Materials (AMAT) said it would acquire the company for $364 million, or $11 a share.

Semitool, based in Kalispell, Mont., makes technology used in the cleaning and preparing of semiconductor wafers.

Applied Materials, the world's largest semiconductor gear maker, said the deal will help it expand its line of chip-making equipment.

Applied Materials shares slipped 5 cents to $13.01.

Earnings reports after the market close were expected from Salesforce.com Inc. (CRM) and Autodesk Inc. (ADSK).