High-tech bellwether Cisco topped Wall Street's earnings estimates and reignited hopes of a turnaround in corporate profits.
US stocks roared ahead last night, propelling the technology-loaded Nasdaq to its best gain in more than a year on the Cisco results.
Cisco, the world's largest maker of equipment that directs Internet traffic, more than tripled last year's soft earnings and said information technology spending is improving.
The forecast offered a ray of hope to investors after weeks of selling on fears of only an anemic recovery in corporate profits. Cisco's stock surged 24 per cent on almost three times its average daily volume.
General Electric jumped more than 7 per cent after standing by its earnings targets. The upbeat outlook from the Dow component lifted sentiment another notch in the wake of a lackluster first-quarter earnings season.
The Nasdaq raced 122.47 points higher, or 7.78 per cent, to 1,696.29, according to the latest available numbers. The tech-loaded measure scored its eighth-largest percentage gain ever and its biggest percentage gain since April 2001 as investors flocked back into high-tech shares such as chip leader Intel and software giant Microsoft.
The blue-chip Dow Jones industrial average surged 305.28 points, or 3.10 per cent, to 10,141.83. The broader Standard & Poor's 500 climbed 39.36 points, or 3.75 per cent, to 1,088.85. The Dow and S&P 500 raked in their best percentage gains since late September 2001.
Microsoft rallied $5.50, or 11.12 per cent, to $54.97 on the Nasdaq. Chip leader Intel jumped $2.83, or 10.82 per cent, to $28.98. Computer heavyweight IBM scrambled $6.25 higher, or 8.20 per cent, to $82.45.