Markets are bouncing today, buoyed by some M&A activity and encouraging economic data in the United States.

At midday, the TSE 300 has gained 111 points to 7,511.

Volume is very strong today at 108 million shares, with buyers outpacing sellers better than three to one, although much of this is attributable to an oil patch merger. Market breadth is more restrained, giving winners a slight edge over losers.

Energy stocks are booming today in the wake of Devon Energy’s US$4.6 billion bid for Anderson Exploration. The deal has the oil and gas index up almost 6%, with producers up almost 9%.

Conglomerates, miners, financials and media stocks are strong, too. There’s weakness in gold and tech.

Devon’s suprise bid for Anderson is the story of the day, boosting its stock 50% with an incredible 49 million shares traded. Rio Alto, Canadian Hunter, Compton, Bonavista, Pan Canadian, Canadian Natural, and AEC are all up smartly in the wake of a deal that ups the price on coveted Canadian gas assets.

The other big traders today are names such as CP and banks, with gains led by TD Bank and CIBC. Better than expected news from the National Association of Purchasing Mangers in the U.S. has some traders hoping that economic recovery is on the way sooner rather than later.

The really big merger news of the day is on Wall Street. HP has made a US$25 billion bid for rival Compaq, but this deal is having the opposite effect from the Anderson deal.

While the Anderson deal is seen as a sign of strength for the industry, the HP-Compaq deal betrays weakness in the tech group. Coupled with weak news from Ericsson and Marconi, tech stocks are looking down. Here at home, Celestica is leading the way south. The losers include Research in Motion, Nortel Networks, C-Mac, ATI.

The other losers include Canfor, Noranda and Moore Corp. Moore is off 2% after reaffirming that it is “comfortable with current analysts’ expectations for third quarter results as well as the full year outlook”. It expects to break-even in the current quarter.

In the wake of news that Ventus Energy’s merger with Petrobank is off, Ventus says that it is terminating its public process to maximize shareholder value and is moving forward with growth through oil and gas exploration and development supplemented by acquisitions. Kevin Bennett has resigned his positions of president, chief operating officer and director and a special committee of the board will search for a replacement.

In New York, markets are booming, partly in celebration of the HP-Compaq deal, but more on the stronger than expected NAPM results. At midday, the Dow Jones industrial average is up 170 points to 10,120. The Nasdaq composite index has gained 17 points to 1,823. The S&P 500 is up 18 points to 1,151.

The CDNX is bucking the bullish trend today, dropping nine points to 3,042. Volume is light at 10.5 million shares. Techs are leading the way down, amid flat oils and miners. William Multi-Tech is the top trader, dropping one of its three remaining cents to trade at 2¢ on 697,500 shares.