Chip and chip-equipment stocks enjoyed strong gains Wednesday ahead of a crucial earnings report from Advanced Micro Devices.
Linear Technology (Nasdaq: LLTC) shares moved up $5.56, or 10 percent, to $60.69 while Lattice Semiconductor (Nasdaq: LSCC) and Applied Materials (Nasdaq: AMAT) gained $3.63 and $3.94 a share, respectively.
A pair of programmable logic devices makers, Altera (Nasdaq: ALTR) and Xilinx (Nasdaq: XLNX), made modest gains after absorbing huge losses Tuesday.
Altera moved up $1.69 to $31.50 and Xilinx tacked on $1.81 to $64.25 after both stocks were cut Tuesday by Salomon Smith Barney and Lehman Brothers.
Salomon analyst Clark Westmont said the downgrades of Altera and Xilinx were due to continued deterioration in the environment for general-purpose semiconductor chips. With supply generally loosening, Westmont said the overheated environment in first half of year has cooled.
Advanced Micro Devices (NYSE: AMD) shares were up a modest 6 cents to $22.81 ahead of its third-quarter earnings report.
First Call Corp. consensus expects the chipmaker to post a profit of 62 cents a share in the quarter.
Last quarter, AMD easily topped analysts' estimates when it posted a profit of $207.1 million, or $1.21 a share, on sales of $1.17 billion.
It also split its stock 2-for-1 in August.
Among other leading chip and chip-equipment stocks, KLA-Tencor (Nasdaq: KLAC) gained $2.63 to $36.88; Intel (Nasdaq: INTC) was off 75 cents to $36.81; Dallas Semiconductor (NYSE: DS) gained 94 cents to $31.19 and Lam Research (Nasdaq: LRCX) moved up 25 cents to $19.44.