Maybe it's the way John Chambers says what he says.
The chief executive of
didn't predict a blowout fourth quarter to wrap up the company's fiscal year, and in fact, he cautioned investors to expect little, if any, top-line growth compared with the third quarter.
But that was good enough, because he didn't take down expectations, even as voice and data service providers continue to slash capital spending in an effort to cope with declining demand and falling revenue. Cisco was jumping 20% to $15.69 Wednesday, a day after the networking giant
beat analysts' earnings estimates for the third quarter.
The company's quarterly report and statement approaching an outlook whipped investors into a buying frenzy, and sectors related to telecom and networking were inspiring a massive rally in the overall market, as the
Dow Jones Industrial Average rose 2.6% and the
Nasdaq skyrocketed 5.6%.
Other once-proud gearmakers were benefiting from the buying spree, at least for a day, but their degraded stock prices reveal just how badly the sector has been beaten down.
was gaining 8% to $4.65, while
was climbing 7% to $2.90.
Optical component producer
was adding more than 8% to $6.79 and rival
was better by 9% to $4.22. Elsewhere,
was up 27%,
was rising 11%,
was up 16%, and
was adding 12%.
The American Stock Exchange Networking Index was enjoying a 10% gain, and the Dow Jones U.S. Telecommunications Index was higher by more than 4%.
Beyond the networking group, telecom voice and data service outfits were charging ahead.
was up 4% to $14.03,
was rising 7% to $15.90, and
was tacking on 6% to $2.34. Wireless service providers were also stronger.
Communications chipmakers were among the best-performing issues of the day.
was up 16% to $26.56,
was posting a 14% gain to $12.24, and
was showing an increase of 23% to $5.88.
All of this, courtesy of Cisco. The company's stock was easily the most actively traded issue of the day, on the Nasdaq or the
New York Stock Exchange. With two hours gone in the trading day, more than 100 million shares of Cisco had changed hands.