By Dan Gallagher, MarketWatch
SAN FRANCISCO (MarketWatch) -- A surge for Netflix Inc. and
strong gains for Apple Inc., Lexmark International Inc. and ARM
Holdings gave a boost to the tech sector on Tuesday morning.
The Nasdaq Composite Index (RIXF) rose 1% to 3,268, while the
Philadelphia Semiconductor Index (SOX) rose 2% and the Morgan
Stanley High-Tech Index (MSH) rose 1.3%.
Netflix (NFLX) was the undisputed leader, with its shares
soaring more than 24% to $218.81. On Monday afternoon, the movie
streaming firm reported better-than-expected results for the first
quarter, driven by the addition of more than 3 million total
streaming subscribers. Its forecast was also ahead of
expectations.
"Netflix put together a second straight quarter of strong
results and we continue to believe the company is back on track
toward significantly disrupting the linear TV market," wrote Doug
Anmuth of J.P. Morgan in a note to clients. He raised his price
target on the stock to $254 from $205.
Apple (AAPL) shares rose 1.8% to $405.85 ahead of its own
earnings report, due after the closing bell.
In a note to clients on Tuesday, Scott Thompson of FBR Capital
Markets lowered his price target on the stock to $525 from $625,
keeping his outperform rating as he feels the shares are
"attractively valued" at their current level.
"However, we continue to struggle with the thought that the next
catalyst to get shares headed in an upward trajectory remains
elusive," he wrote.
Lexmark (LXK) shares jumped more than 7% to $27.40 after the
printer maker reported results that were ahead of its previous
forecast. The company projected a 6%-8% drop in revenue for the
current quarter; analysts were modeling an 8% drop for the
period.
The U.S.-listed shares of ARM Holdings (ARMHY) jumped more than
13% following the company's first-quarter report, which beat
forecasts. ARM provides basic semiconductor designs for use in
mobile devices.
Shares of Texas Instruments (TXN) also were up more than 2%
after the chip maker posted upbeat results, and pointed to
strengthening demand in the automotive and industrial markets.
Shares of Sanmina Corp. (SANM) also traded up more than 13%
after the company swung to a profit in its fiscal second
quarter.
On the other hand, shares of Molex Inc. (MOLX) slipped more than
5% after the electronics-component company posted
weaker-than-expected earnings.
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