By Rex Crum
An upbeat quarterly earnings report and outlook from Intel Corp.
spurred gains across the chip sector and led to a broad rally in
tech stocks Wednesday.
Intel (INTC) rose 75 cents a share, or more than 3%, to $23.52
after the world's largest semiconductor said it earned $2.4
billion, or 43 cents a share, on $10.3 billion in sales for the
first quarter. The results reported late Tuesday, well above what
Intel reported in the same period a year ago, topped analysts'
average forecasts calling for a profit of 38 cents a share and
revenue of $9.8 billion.
Despite the gains from Intel, some analysts who follow the
company raised questions about how much higher the Dow Jones
Industrial Average component's shares can climb.
With Intel in the lead, nearly every other major chip company
saw its shares rise Wednesday. The Philadelphia Semiconductor Index
(SOX) rose 4.3%.
The Nasdaq Composite Index (RIXF) also climbed, rising almost 39
points to 2,504, while the Morgan Stanley High Tech 35 Index (MSH)
gained almost 2%.
Intel's top rival, Advanced Micro Devices Inc. (AMD), which
reports quarterly results on Thursday, rose 33 cents a share, or
more than 3%, to $9.89. Texas Instruments Inc. (TXN), Broadcom
Corp. (BRCM) and Micron Technology Inc. (MU) each rose at least
3%.
Kulicke & Soffa (KLIC) shares rallied $1.51, or more than
19%, to $9.37 after the chip-equipment company reported
second-quarter sales of $153 million; analysts had forecast sales
of $146.4 million. Kulicke & Soffa also disclosed a
third-quarter revenue outlook that topped analysts' estimates.
That helped push up other chip-equipment stocks. Applied
Materials (AMAT), KLA-Tencor (KLAC), Novellus Systems (NVLS) and
Teradyne (TER) were all up more than 4%.
Apple Inc. (AAPL) shares rose $3.26 to $245.69 after the company
said it would have to delay the international rollout of the iPad
due to better-than-expected demand in the U.S. Apple said that it
sold more than 500,000 iPads during the first week of the device's
release and that demand "will likely continue to exceed our supply
over the next several weeks."
The iPad would now go on sale in international markets at the
end of May, Apple said.
Palm Inc. (PALM) climbed 16 cents a share, or more than 3%, to
$5.32. More speculation arose that the company might be acquired
after Harbinger Capital Partners disclosed it has acquired a
"passive stake" of 16 million shares of Palm stock. Harbinger's
ownership accounts for almost 9.5% of Palm's outstanding
shares.
Among other tech stocks, Google Inc. (GOOG), which reports
quarterly results on Thursday, rose $2.23 to $589. Gains also came
from Dell Inc. (DELL), Seagate Technology (STX), Microsoft Corp.
(MSFT) and Adobe Systems Inc. (ADBE).