Within just hours of trading, the prices of Intel shares increased by a whopping 7% when the company declared the results for the second quarter of this fiscal year. A 34% increase in the sales in the second quarter increased the prices of the shares well beyond Wall Street’s expectations. This has put to rest the fear of an unstable economy.
Due to a slight drop in the demands for a personal computer, a number of firms in the hardware segment saw a slight price drop in their shares.
Eve Jung, leading a group of financial analysts at Citigroup, wrote in a note that though currently the demand for the personal computers is slightly low, the prices of the stocks of hardware firms have already reached the market lows and can only trend northward going forward.
The analysts also mentioned that the excellent performance by Intel in the second quarter is sure to impact a lot of hardware companies positively and help them show a significant growth. In the Chinese market, they expect companies like Lenovo, Asustek and Acer to go forward, considering their consistently good performance over the last few quarters.
There were a lot of hardware companies in the Asian market that did show a positive trend. In Hong Kong, the Lenovo Group Limited showed a growth of 5.9%. In Tokyo, Sony Corp increased by 2% and Toshiba by 4%. Acer showed a 6% growth in Taipei alongside Asustek Computer at 3.3%. Finally, in Mumbai, HCL Infosystems showed a growth of 0.4%.
Despite all these positive figures, a lot of analysts are being very cautious in their approach. Masashi Kubota, a financial analyst with Merill Lynch said that the growth by Intel will provide a temporary relief to the market at the moment. He said that the demand for the personal computers will be monitored closely before arriving at anything conclusive.
