By Rex Crum, MarketWatch

SAN FRANCISCO (MarketWatch) -- Tech stocks edged upward Thursday, with Nvidia Corp. shares surging after the announcement of a new partnership between the graphics chip maker and ARM Holdings PLC.

Nvidia (NVDA) shares rallied $2.35, or almost 14%, to close at $19.33 after the company said late Wednesday it will begin developing central processors for PCs based on a design from ARM Holdings PLC (ARMHY). ARM's shares shed 10 cents to close at $21.78.

The move is seen as a challenge to Intel Corp. (INTC), which has been making inroads into Nvidia's graphics-chip business.

Gains also came from Marvell Technology Group Ltd. (MRVL), which rose $1 a share, or more than 5%, to close at $19.56; JDS Uniphase Inc. (JDSUD), up $1.01, or 6.7%, to end the day at $16.04, Dell Inc. (DELL) , which rose 39 cents a share, or almost 3%, to close at $14.26 and Ciena Corp. (CIEND) , up $1.06, or 4.6%, to finish the day at $23.99.

Microsoft Corp. (MSFT) rose 82 cents a share, or almost 3%, to close at $28.82. Chief Executive Steve Ballmer said in a keynote speech at the Consumer Electronics Show that Microsoft has sold 8 million of its Xbox Kinect videogame units since November, and he laid out plans to expand the reach of the Windows operating system platform.

The Nasdaq Composite Index (RIXF) rose 7.7 points to close at 2,709, while the Philadelphia Semiconductor Index (SOX) advanced almost 2%.

Declines came from MetroPCS Communications Inc. (PCS), which tumbled 96 cents a share, or 6.7%, to close at $13.30. The discount wireless-service carrier said its net-subscriber additions fell 6% in the fourth quarter.

Sourcefire Inc. (FIRE) slid $2.14 a share, or 8%, to close at $24.68 after the network-security-technology company said it would acquire Immunet for $21 million. 
 
 
 
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