Apple Upgrade Sends Tech Stocks Soaring

Apple (NASDAQ: AAPL) shares surged nearly 7% Tuesday on an analyst’s upgrade, while the rest of the market soared after an unexpected rebound in consumer sentiment.

Morgan Stanley analyst Kathryn Huberty said Apple’s iPhone — and the potential of the mobile Internet in general — are underappreciated by investors, and she called the company’s shares “fundamentally undervalued.”

The bullish research note was also good news for rivals Research in Motion (NASDAQ: RIMM) and Palm (NASDAQ: PALM), which saw their shares surge. Palm also benefited from an RBC Capital upgrade, its shares ending the day 10% higher.

NetApp (NASDAQ: NTAP) was another winner, up 8% on a Collins Stewart upgrade. Collins Stewart analyst Ashok Kumar said NetApp’s acquisition of Data Domain (NASDAQ: DDUP) will strengthen its competitive position.

Dell (NASDAQ: DELL) rose 2.7% ahead of its quarterly results due out after the close on Thursday. AMD (NYSE: AMD) was another winner, up 6%.

The Dow and S&P gained around 2.5% and the Nasdaq 3.5% on a Consumer Confidence reading of 54.9, 12 points higher than economists expected and nearly 30 points off the record low set in March.

The Nasdaq soared 58 to 1750, the S&P 500 gained 23 to 910, and the Dow surged 196 to 8473. Volume rose to 5.67 billion shares on the NYSE, and 2.1 billion on the Nasdaq. Advancers led by a 30-7 margin on the NYSE, and 21-6 on the Nasdaq. Upside volume was 84% on the NYSE, and 91% on the Nasdaq. New highs-new lows were 20-48 on the NYSE, and 37-18 on the Nasdaq.