The Internet sector has pulled a Lazarus, with

Amazon.com

(AMZN) - Get Amazon.com, Inc. Report

raising the group from the dead. The online merchant has been helping the Internet indexes see green, ahead of

Yahoo's

(YHOO)

highly anticipated earnings release after the bell today.

The

DOT

, or

TheStreet.com Internet Sector Index

, was lately up 1.9%, while the e-commerce index, charted by

TheStreet.com E-Commerce Index

, was also chalking a healthy gain of 1.5%. In late-afternoon trading, Amazon shares were up 7.7% to $12.93, while Yahoo was down 1.2% to $15.84.

Indeed, Amazon, the No. 1 online seller of books, toys, electronics, prescription drugs, and more, has been coming up with a string of positive news that the market just loves. Two days ago, the Seattle-based company

forecast a narrower-than-expected first-quarter loss that pleased the market. And its shares, which have almost doubled in a week, climbed sharply today after Amazon announced its latest deal, this time with

Borders

(BGP)

to revamp and relaunch Borders' beleaguered e-commerce site. Borders, which said it was cutting 70 jobs as a result of the deal, had been falling but lately was flat at $16.98.

The companies did not disclose the terms of the deal, but analysts at

Credit Suisse First Boston

think the alliance is beneficial for both sides. In a recent research note, CSFB wrote that the deal "echoes the successful Toys R Us alliance" that Amazon made with the toy supplier to operate a co-branded online toy store. "In-store promotions and kiosks could drive incremental customers to the co-branded site, and that the combined buying power of Amazon and Borders increases supplier leverage," CSFB wrote today, maintaining Amazon as a buy.

TheStreet.com's

TheStreet Recommends

Tim Arango recently

scrutinized the plethora of deals coming from Amazon, which recently said it was joining teams with

Adobe Systems

(ADBE) - Get Adobe Inc. Report

as well as

Best Buy

(BBY) - Get Best Buy Co., Inc. Report

, and concluded that it's perhaps too soon to start celebrating.

Nevertheless, the drumbeat of positive news goes on, and the market is not the only one buying it. Today,

Moody's Investors Service

, a credit rating agency, revised Amazon's junk-rated debt to positive from stable, citing the company's focus on achieving profitability, and a "clearer strategy to harvest the investment in existing operations rather than expand capital on new businesses." Moody's also said it sees the "potential for positive cash flow within the medium term."

Skeptics of Amazon still may be out there, but the company's sudden strength has been helping the Internet sector -- even though many on Wall Street are dubious of reading Jeff Bezos' shop as an Internet bellwether because of its retail bent.

Some beaten-down e-tailers were getting a reprieve from Amazon's news. For example,

priceline.com

(PCLN)

was lately up 1.3% to $3.04, while

Barnes&Noble.com

(BNBN)

was also up 0.8% to $1.31.

Travelocity

(TVLY)

was also rising 5.5% to $21.09.

The market is clearly holding its breath for the worst from Yahoo, an Internet bellwether, whose announcement will provide some

key direction for the Internet industry, including the prospects, or not, of the online advertising business. Will the sector still be as cheery as it is later when Yahoo drops the other shoe? We shall soon see.