By Rex Crum, MarketWatch
SAN FRANCISCO (MarketWatch) -- Rackspace Hosting Inc. and Zynga
Inc. were among the notable tech stocks to advance Tuesday as the
overall sector manages to close with mild gains.
Rackspace (RAX) pulled back from its high point, but still ended
the day with a gain of 3.5% at $33.86 a share. Before the market
opened, Morgan Stanley analyst Simon Flannery raised his rating on
Rackspace's stock to overweight, or buy, from equal-weight, and set
a price target of $45 a share.
Flannery cited improvements in order bookings and a
differentiated product line among the reasons for his rating
upgrade.
Zynga (ZNGA) came back from its losses on Monday to rise nearly
3% and close at $4.84 a share. An IPO from Zynga rival King Digital
Entertainment was expected to price after the close of trading
Tuesday. However, skepticism over the growth prospects for the
"Candy Crush Saga" developer began to weigh on the opinions of some
industry analysts.
Attention was also being given to Box Inc., as the
cloud-computing company filed its initial paperwork late Monday to
go public.
Amazon.com Inc. (AMZN) shares rose $2.86 to close at $354.71 one
day ahead of the e-commerce kingpin's AWS Summit in San Francisco,
where the company will give updates on its growing Web services
business.
Microsoft Corp. (MSFT) shares shed 16 cents to close at $40.34.
Anticipation continued to grow in advance of Chief Executive Satya
Nadella's first press conference as CEO on Thursday.
EBay Inc. (EBAY) was trimmed by 21 cents a share to end the day
at $56.33. The e-commerce leader issued a "definitive" proxy
statement and set a date of May 13 for its annual shareholders
meeting.
In its letter to shareholders, eBay urged shareholders to vote
against a nonbinding proposal by investor Carl Icahn for the
company to spin off PayPal in an IPO. EBay is also against Icahn's
efforts to get two of his nominees on the company's board of
directors. On Monday, Icahn called his plan for eBay to spin off
20% of PayPal as one of "pragmatism."
Among other bellwether tech companies, gains came from Apple
Inc. (AAPL), Facebook Inc. (FB), IBM Corp. (IBM) and
Hewlett-Packard Co. (HPQ).
The Nasdaq Composite Index (RIXF) rose almost 8 points to close
at 4,234 and the Philadelphia Semiconductor Index (SOX) ended the
day with a gain of nearly 1%.
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