The Night Watch: Agile, Ariba Take a Dive After Calling Merger Off

(Updated from 7:20 p.m. ET)

The bell may have rung, but ugly Monday isn't over. Indeed, stocks, which tumbled in the daytime session, were doing some further falling in extended-hours trading as companies continued their stream of unpleasant earnings confessions. Tonight's danger zone lay in the software sector.

Agile Software (AGIL Quote) was plummeting on both Island ECN and Instinet after business-to-business software company Ariba (ARBA Quote) said it was scrapping its planned acquisition of the San Jose, Calif., company. The stock recently gave up 10.3% to $9.44 on Instinet, and 11.1% to $9.35 on Island. Volume was heavy on both platforms.

In a prepared statement, the companies cited the "challenging economic and market conditions," and said they have mutually agreed to terminate their proposed merger agreement without payment of any termination fees. ...