(Updates stock prices throughout)

Chipmaker

Marvell

(MRVL) - Get Report

offered a hint that the tech sector is poised to rebound Monday,

raising

its second-quarter revenue forecast.

The Santa Clara, Calif.-based firm now expects sales between $600 million and $630 million, compared to its earlier projection of $540 million to $580 million.

As a key

component

manufacturer, Marvell's improved outlook could

bode well

for the broader tech sector, which has suffered during the global economic slowdown.

"We are optimistic in our near-term outlook based on the improved order rate we have experienced so far in our second quarter," said Dr. Sehat Sutardja, Marvell's CEO. "We believe

this generally signals some strengthening in our customers' expectations for their businesses."

Despite Marvell's positive outlook, shares of the company dipped 53 cents, or 4.4%, to $11.48, as the Nasdaq fell 3.35%. Rival

LSI

(LSI) - Get Report

, meanwhile, fared better as investors reacted to Marvell's forecast. The stock fell 7 cents, or 1.5%, to $4.49.

Marvell's

stock

was recently

upgraded

by JMP Securities thanks to the popularity of its flash memory controllers and demand from hard disk drive manufacturers. Storage accounted for more than half of Marvell's sales during its recent first quarter, and the firm also sells silicon for mobile handsets, PCs, switches and wireless networks.

"We are reiterating our positive outlook on MRVL following this upside surprise," wrote Avi Cohen, an analyst at Avian Securities, in a note released Monday, adding that the ripple effect will reach other parts of the tech sector.

Specifically, Cohen expects the upgrade to lift shares of hard drive maker

Western Digital

(WDC) - Get Report

.

"While Marvell did not point to a specific area of strength as catalyzing its upside, Western Digital remains Marvell's most significant account and we believe upside of this magnitude is unlikely without a strong Western Digital contribution," he added.

Shares of Western Digital, however, retreated with the broader tech market Monday, falling $1.09, or 4.3%, to $24.33.

Despite its bullish guidance, Marvell also struck a conservative tone Monday. "Even with the recent pick-up in demand for our products, we encourage everyone to remain cautious of the demand environment for the next few quarters, "said Sutardja, in a statement.

Investors have been eagerly awaiting any signs of an IT spending turnaround, although

recent results

from the likes of

Dell

(DELL) - Get Report

suggest that there is still some way to go. Chip giant

Intel

(INTC) - Get Report

, however, offered some

hints

of a tech spending turnaround earlier this year, with CEO Paul Otellini seeing positive signs in the PC market.