Semiconductor Makers Lift Stock Market to Strongest Quarter in

2020 has been a crazy year for investors, and the huge bear market that came in the first quarter got largely reversed by the strongest upward move in a quarter in more than 20 years. The Dow Jones Industrial Average (DJINDICES:^DJI), S&P 500 (SNPINDEX:^SPX), and Nasdaq Composite all moved higher as market participants ignored uncertainties related to the coronavirus pandemic and instead focused on the prospects for businesses to move forward and start growing again.

Today’s stock market

Data source: Yahoo! Finance.

Semiconductor stocks were among the strongest performers, helping to give the Nasdaq an outsized gain compared to its fellow major market benchmarks. Micron Technology (NASDAQ:MU) was the big winner on a solid earnings performance, but other stocks in the industry also managed to post good gains as well.

Micron’s earnings win

Micron Technology saw its stock rise almost 5% after the chipmaker released its fiscal third-quarter financial results. The numbers weren’t entirely positive, but they still showed how well the company held up during the worst of the pandemic so far.

Micron’s revenue climbed almost 14% during the period compared to the year-earlier quarter. However, higher costs of goods sold cost the company more than six percentage points of gross margin. That, along with higher operating expenses as well, contributed to a 21% drop in adjusted net income.

Nevertheless, most investors had expected far worse from Micron. Moreover, the chipmaker said that it anticipates year-over-year growth accelerating in the fiscal fourth quarter to 23%, and shareholders were pleased with bottom-line guidance of $0.95 to $1.15 per share on an adjusted basis.

Image source: Getty Images.

Feeling chippy

Tech industry followers took the report as a sign not just of Micron’s ability to survive the COVID-19 pandemic but also of healthier cyclical trends in the entire chip sector. The shift toward remote work has led to a big acceleration in the pace of digital transformation, including a rise in sales of key tech products like data centers. Making components for those products is lucrative for chipmakers, and even as businesses try to recover, they’re still making plans to deal with a potentially extended period of time during which they’ll face the possibility of having to support unconventional work arrangements.

Micron’s segment numbers showed encouragingly broad-based success. Prices improved for memory chips, and sales of cloud solid-state drives doubled sequentially from three months ago. Revenue from mobile products was also higher, with companies preparing for the coming 5G upgrade cycle.

The news sent shares upward across…