Stocks to Watch: MSFT, ETR, NZRO, OCLR, CERN

Federal antitrust officers are leaning towards a forced spin-off of Microsoft's (MSFT Quote) Office software business in an effort to end the company's monopoly in the U.S. computer industry, The Wall Street Journal reported, citing people familiar with the situation. Office software is the largest part of Microsoft's applications unit, accounting for more than 40% of total revenue and a significant portion of profits. The story also said Microsoft would be subject to restrictions on its conduct until the unit is divested as well as during any appeal of a breakup decision.

USA Today and The Washington Post published separate accounts about the proposed plan, also involving splitting the company along product lines.

For more on this story, see coverage from TheStreet.com/NYTimes.com's joint newsroom.

A number of firms released negative research on Microsoft in the wake of the company's downward revision of its revenue outlook and disappointing March-quarter revenue report. Goldman Sachs analyst Rick Sherlund took the stock off the recommended for purchase list and downgraded the stock to market outperform from buy. SG Cowen cut its rating to buy from strong buy. Lehman Brothers cut its price target on the stock. Microsoft plunged 13, or 16.3%, to 65.

Mergers, acquisitions and joint ventures

Qualcomm (QCOM Quote) said it invested $144 million in NetZero (NZRO Quote), an advertising-supported free Internet access provider, for a 10% stake. The wireless communications company now owns about 11.5 million shares of NetZero. ...