Stocks on Wall Street have risen the most in five weeks, as takeovers in the drug and technology industries confirmed mergers and acquisitions are rebounding from the slowest pace in six years.

Affiliated Computer Services jumped 14% after Xerox made its biggest purchase by agreeing to buy the company for $US6.4 billion. Abbott Laboratories advanced 3.8% on plans to purchase Solvay’s pharmaceutical unit and gain control of the TriCor cholesterol drug.

Cisco Systems had the steepest gain in two months as Barclays Plc predicted revenue will increase.

Microsoft fell harder than analysts were expecting during the June quarter, with profit plummeting 29% and revenue down 17%.

The company's shares (NAS: MSFT) tumbled up to 8% in after-hours trading.