Apple Shines in Frenzied Tech Rally

NEW YORK (TheStreet) -- The tech-heavy Nasdaq posted gains this week thanks to a big boost led by Apple(AAPL) and an improved U.S. economic climate.

Reports that consumer electronics giant would be releasing an iPad 3 next month sent Apple's stock soaring to new highs and close to $500. The updated tablet will have better graphics, a faster processor and a higher resolution display, according to The Wall Street Journal.

Apple's gains came in spite of labor protests demanding that the company change its working conditions in Chinese factories, as well as the release of Steve Jobs' FBI file.

Shares of Apple are up just over 8% this week to $496.77.

News that human capital management software company Taleo(TLEO) would be purchased for $1.9 billion by Oracle(ORCL) also helped to strengthen tech stocks.

The acquisition is Oracle's biggest play in the white hot cloud computing space, which lets businesses store their data on remote servers on the Web. Taleo shares rose more than 17% in response to the announcement, as did other cloud stocks, including Salesforce(CRM) which edged up 1.35% to $127.30 on Friday.

LinkedIn's(LNKD) fourth-quarter earnings soared on Thursday, pushing shares up over 14% to $87.28 during Friday trading. The business-oriented social network reported fourth-quarter earnings of 12 cents per share on $167.7 million in revenue. Analysts were expecting the company to bring in revenue of $159.7 million and earnings of 7 cents per share.

Chipmaker Nvidia(NVDA) also rallied this week, edging up 1.5% after settling patent litigation with memory chip technology company Rambus(RMBS). Litigation between the two companies stretches as far back as 2008.

Other tech companies, meanwhile, struggled this past week.

Groupon(GRPN) shares have fallen nearly 14% since Monday to $21.11 after posting a surprise lost during fourth quarter earnings.

The company, which issued its first quarterly report as a public firm since completing its IPO in early November, generated an adjusted loss of $9.8 million, or 2 cents a share. Revenue nearly tripled to $506.5 million.

And shares of Apple(AAPL) partner Nuance(NUAN) declined almost 14% to $26.30 after the maker of voice and language technology products missed Wall Street expectations for its fiscal first-quarter results on both the top and bottom lines.

--Written by Olivia Oran in New York.

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