The turn of events was certainly not good for Sun. Taking a look at their stock price today, you can see that it opened up abysmally low, losing nearly a quarter of its value overnight. It dipped down to under $6.70 a share, where previously Sun had rejected an offer from IBM to buy at $9.40. Not only does that hurt Sun, but it potentially influences IBM as well considering a lower value of Sun makes it an easier buy.
We've heard this before. Every time Microsoft and Yahoo went to the negotiating table, as soon as one party walked away, Yahoo's stock price dropped. This continued until Yahoo reached where they are today, their company is worth a mere fraction of what it was several years ago. Sun hasn't dipped below where they were before the takeover talks begun, however, which means that a lot of Sun's value would have come from the fact that IBM was going to buy them in the first place. It isn't just the news media that runs on rumors and speculation, it seems.