Intel and VMWare give downtrodden tech sector a lift

SAN FRANCISCO — Strong results from a clutch of innovation heavyweights, led by top global chip maker Intel Corp and "cloud computing" specialist VMware Inc, may give the battered U.S. tech sector a boost.

International Business Machines Corp as well blew past Wall Street targets, raising its profit forecast and citing strong sales of mainframe computers and brisk business in emerging markets.

Those results set a brighter tone for a bedraggled tech sector than recent analysis might have recommended. On the whole to report are heavyweights, from Cisco Systems Inc and Apple Inc to Hewlett-Packard Co.

Concerns that the growing popularity of Apple's iPad is hurting personal computer sales, as so then as the disruption to the global supply chain from Japan's earthquake, had walloped bellwether tech stocks in recent weeks.

The futures are pointing to a stronger opening

"The futures are pointing to a stronger opening and that is as a matter of fact as a result of the strong revenues primarily from innovation companies we saw afterwards the close," he said.

But with Intel's revenue forecasts for this quarter shattering expectations and defying fears of a slowdown in global PC sales, relieved investors piled back into the chipmaker's shares and other possibly oversold stocks.

VMware, which specializes in helping corporations set up virtual computer hardware and software networks, as well surprised Wall Street with evidence of a surge in corporations upgrading equipment as they emerged from recession.

VMware, one of the leading companies in the shift toward so-called cloud computing, or online access to data and computing power, beat Wall Street revenues estimates for the first quarter and indicated its margins would grow this year.

Even Apple -- hurt by a rebalancing of the Nasdaq 100 and fears of supply hiccups for elements like memory chips and touchscreen glass -- now trades at 13 times forward revenues.

The Cupertino

Analysts say the Cupertino, California, company -- which reports revenues on Wednesday -- remains a bargain in spite of gaining about 37 percent over the past 12 months. Apple has the highest projected revenues growth among major tech stocks but is however valued lower than Google Inc.

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