The stock market staged its biggest rally in four months on Wednesday, thanks to blowout quarterly results from Intel.
Intel jumped 7.3% and rival AMD gained more than 8% on a day that saw the entire chip sector rise 5%. The Nasdaq was up 3.5%, as Intel’s results delivered the first solid hint of economic recovery for the tech sector.
But some analysts cautioned that it will take time to determine if demand is beginning to return, or if Intel merely benefited from inventory restocking. Intel said that consumer demand was strong in the quarter, but that businesses remain cautious.
Cisco, Juniper, Applied Materials, HP and Research in Motion were other standouts.
Thursday will be another test for the market, with Google, IBM and Nokia set to report their results. Nokia will report its earnings in the morning, and Google and IBM after the close.
Meanwhile, two reports showed that manufacturing remains in recession, although not as bad as feared, and the Federal Reserve lifted its economic forecast.