From Jeremy C. Owens: Semiconductor stocks were collectively trading about 3.5% higher Friday morning, after Broadcom Inc. AVGO, +10.09% results calmed some fears about the sector and the company’s chief executive said that a downturn had reached its bottom. The PHLX Semiconductor Index SOX, +3.09% rose 3.5% in the first hour of trading and all 30 components were trading higher, led by Broadcom, which was up more than 11%. After Broadcom released earnings that were slightly better than expected Thursday after markets closed, Chief Executive Hock Tan said in a conference call, “We expect our semiconductor business to bottom in the second fiscal quarter driven almost entirely by the seasonal drop in Wireless. But looking to H2, we are confident the semiconductor business will resume very meaningful growth.” That sentiment mirrors what other executives have said about a current down cycle for chip sales, including Microchip Technology Inc.MCHP, +2.31% CEO Steve Sanghi, who called a bottom last week and has a history of correctly predicting swings in the semiconductor sector. Besides Broadcom, chip-equipment stocks were hot, with Lam Research Corp.LRCX, +4.47% MKS Instruments Inc. MKSI, +7.77% ASML Holdings NVASML, +4.44% and Applied Materials Inc. AMAT, +3.85% increasing more than 4% Friday morning. The PHLX Semiconductor Index has declined 5% in the past year amid concerns about the chip sector, as the S&P 500 index SPX, +0.41% has gained 2.2%.
