Stocks are rebounding this morning following a couple of big mergers in the United States. Mergers of this size are often seen as a signal of corporate optimism, and that is cheering traders.

Bank of America and FleetBoston Financial are hooking up in a US$47 billion all-stock deal that will create the second-largest bank in the U.S.

As well, Anthem is buying Wellpoint for US$15.2 billion to create the largest health management organization in the U.S.

At midday, the S&P/TSX index is up 42 points to 7,656. Volume is solid, if unspectacular, at 112 million shares.

The buying is well ahead of the selling by a margin of about seven to two. Market breadth is favouring winners over losers by a margin of 31:21.

Most sectors are recovering from last week’s big sell off. Only health care stocks and golds are still looking weak. Techs, which fell the furthest last week, are bouncing back best today. They are up about 1.5%. And, there is strength in financials, industrials and consumer stocks.

Nortel Networks is leading the tech recovery, gaining 2.2% in decent volume of 10.9 million shares. There are also impressive gains in Zarlink Semi, Certicom, Celestica, Infowave, Systech, Bakbone Software and Sierra Wireless.

Blue chips are also making gains, with buying in Bombardier, Abitibi, Baytex and BCE. Blackrock Ventures is stronger, as is Allstream, WFI Industries, and VSM Medtech.

Transat is up 6.4% on an M&A deal of its own. It is selling its French subsidiary Anyway to IAC/InterActiveCorp for $81.6 million.

On the downside, there is weakness in the miners that held up last week, including Queenstake Resources, Constellation Copper, Bema Gold, Barrick, Kirkland Lake Gold, Northern Orion Exploration, Southwestern Resources, Golden Star and Ivanhoe Mines.

Notably, Biovail is also down a fair bit, as is Quebecor World.

In other M&A news, Mullen Transportation has signed an agreement to acquire Cora Lynn Drilling Co. Ltd., a private Alberta-based corporation. No price was disclosed, although Mullen said it will be able to finance the purchase from existing bank facilities along with additional long-term financing from its current lender.

In New York, news of the big mergers is helping boost spirits. The Dow Jones industrial average has gained 42 points to 9,625. The Nasdaq composite index is 11 points higher at 1,877. The S&P 500 has added five points to 1,034.

The S&P/TSX Venture is making gains of its own today, up eight points at 1,489. Volume is also strong at 39.6 million shares, led by Samsys Technologies Inc. It is up 2¢ to $1.75, on 628,000 shares.