Salesforce shares rose from $71.4 to $75.82 in about a minute late Tuesday afternoon, after which trading was temporarily halted.
The stock closed 1.6 percent higher at $72.75. Microsoft shares closed down 1.3 percent at $47.60.
Microsoft is evaluating a bid after Salesforce was approached by another potential buyer, Bloomberg reported, citing people with knowledge of the matter.
Microsoft is not in talks with Salesforce, and no deal is imminent, the report said. (bloom.bg/1DR2uB3)
Microsoft declined to comment, while Salesforce could not immediately be reached.
Bloomberg had reported last week that Salesforce was working with financial advisers to help it field takeover offers after being approached by a potential buyer.
The news sent the company’s shares up as much as 17.3 percent to an all-time high of $78.46 last Wednesday.
Reporting by Anya George Tharakan in Bengaluru; Editing by Sriraj Kalluvila