The tech-heavy Nasdaq composite index rose Thursday by 61 points, or 3.9 percent, to 1,652, its highest finish of the year, before markets closed for the Easter long weekend.

Cisco's Thursday announcement that it will buy application management vendor Tidal Software for about US$105 million is another sign that cash-rich companies looking to expand their lines of business are taking advantage of the recession to go shopping.

Cisco has long said it is committed to a growth rate between 12 percent and 17 percent. To achieve this, it needs to expand beyond its strength in its core networking market. With the Tidal buy, it gains expertise in real-time applications performance optimization, helping it to challenge the likes of IBM and BMC in the data center.

Investors seemed to like the story, pushing up Cisco shares by $0.69 to close at $17.82 Thursday.

Other M&A activity is in the works in the networking and carrier equipment arena. Nokia Siemens Networks, Avaya and Siemens Enterprise Communications are circling beleaguered Nortel Networks, The Wall Street Journal reported Wednesday. Nokia no doubt sees a potentially cut-rate opportunity to make inroads into the North American market.