Facebook gains on Instagram plan; techs up

Getty Images Enlarge Image Facebook shares gained on Friday following plans to start feeding ads into its Instagram service.

SAN FRANCISCO (MarketWatch) — Facebook picked up more gains on Friday afternoon, helping to lead the tech sector higher, after the company announced plans to start running ads over its popular Instagram service just as rival social network Twitter released its own financial details in a plan to go public.

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Facebook (FB)  made the announcement about Instagram on Thursday afternoon — just minutes before Twitter (TWTR)  released its S-1 filing for an IPO that could take place within the next month. That filing showed Twitter with a fast-growing advertising business that was still just a fraction of the size of Facebook's own revenue base. Facebook shares were up 2.9% to $50.62 by early afternoon.

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On its Instagram blog, Facebook announced that it will start adding advertisements into the service."Seeing photos and videos from brands you don't follow will be new, so we'll start slow. We'll focus on delivering a small number of beautiful, high-quality photos and videos from a handful of brands that are already great members of the Instagram community," the blog post read.

Arvind Bhatia of Sterne Agee wrote in a note that "we think Instagram is now well positioned to begin monetization." He added that Instagram ads, which will include video, "could ultimately command a premium to Facebook ads although that will likely take a while."

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The Nasdaq Composite (COMP)   rose 0.9% to 3,807 while the Philadelphia Semiconductor Index (SOX)   rose by 0.8% and the Morgan Stanley High-Tech Index (MSH)  rose by 0.9%.

Yahoo (YHOO)   shares were up 2.6% to $34.74. Yelp (YELP)  rose 1.8%.

Apple (AAPL)  edged down by 0.5% to $481. Gene Munster of Piper Jaffray sent a note to clients on Friday, saying supply of the iPhone 5S seems to be improving two weeks after its initial retail launch.

BlackBerry (BBRY)   (CA:BB)  shares fell by 0.3% to $7.71. In a note to clients, Canaccord Genuity analyst Mike Walkley noted the company's regulatory filing earlier this week that showed growing cash burn and services declines.

He kept his $7 price target on the stock — below the $9 offered by Fairfax Financial — because "we anticipate a lower revised bid post additional due diligence will be required to secure full institutional investor funding for Fairfax's proposal."