Despite concerns of further mortgage write-offs by AIG, the markets turned positive during the midday as investors focused on upbeat earnings and mergers and acquisitions. The Dow gained 30 points to 12,212 while Nasdaq climbed 13 points to 2318.

On the upside

Bayer AG affiliate Medrad Inc. will pay approximately $344 million in cash to purchase Possis Medical (Nasdaq: POSS).

Casual restaurant operator Darden Restaurants (NYSE: DRI) expects same store sales to rise in the third quarter and reaffirmed its outlook for fiscal 2008.

Hypercom (NYSE:HYC) and rival Ingenico engaged in discussions to explore the possible acquisition of Hypercom by Ingenico.

On the downside

LCA-Vision (Nasdaq: LCAV) blamed higher advertising costs and fewer procedures for reporting lower fourth quarter earnings.

Fourth quarter earnings for PNM Resources (NYSE: PNM) plunged to miss expectations due to the low availability at three of its power plants in New Mexico.

Loews (NYSE: LTR) reported lower fourth quarter earnings due to investment losses and higher costs.

In the broad market, declining issues outpaced advancers by a margin of nearly 5 to 4 on the NYSE and by 10 to 9 on Nasdaq. The Russell 2000 which tracks small cap stocks lost 2 points to 697.