U.S. stocks and exchange traded funds (ETFs) are in positive territory this morning as better than expected earnings reports boosting investor confidence and send them pouring back into the markets.

Chipmaker giant Intel (INTC) earnings report boosted investor confidence, thanks to its increase in sales revenue numbers. The figures suggest that consumers are purchasing computers at a higher rate than expected.  Intel’s third-quarter revenue forecasts were higher than analysts expected, further indicating that Intel believes the personal computer market has bottomed and is on its way to a recovery.  Excluding the fine that was imposed by the European Union, Intel reported quarterly earnings of $0.18/share, smashing Wall Street’s expectations of $0.08/share.  The news sent the Semiconductors HOLDRs (SMH) up 4% in morning trading; INTC is 23.3%.

Drug developer and medical device maker Abbot Laboratories (ABT) reported a decline in second-quarter profit of 3% but still met Wall Street’s expectations.  Abbot earned $0.89/share, right in line with what analysts had forecast.  Additionally, AMR Corp. (AMR), parent company of American Airlines (AA) reported a loss of $1.14/share, citing a drop in travel because of the recession.  The loss was still narrower than the $1.28/share loss expected by analysts.

On a different note, the Labor Department reported that consumer prices rose by 0.7% in June, marking the biggest one-month gain in nearly a year and are down nearly 1.4% as compared to a year ago.  To add to this, core inflation, which excludes food and energy, posted a slight increase of 0.2%.

The Federal Reserve reported that industrial production fell by 0.4% in June as the global recession put a damper on output for wide range of manufactured goods, such as automobiles, machinery and household appliances.  On a positive note, this decline is much lower than the 1.4% plunge seen in May, indicating that the recession is starting to slowly loosen its grip on the economy.

Black gold continues its volatility as prices went north of $61/barrel.  Investors are eagerly awaiting the weekly crude inventory reports to see what the demand for the commodity looks like.  The United States Oil Fund (USO) was up 2% in morning trading.

All three major U.S. indexes are up in morning trading.  The Dow Jones Industrial Average is up 1.8%, the S&P 500 gained 1.8% and the Nasdaq is up 2.4%.

For more stories on semiconductors, visit our semiconductors category.

Kevin Grewal contributed to this article.

Tags: Commodity ETFs, Dow Jones Industrial Average, Energy, NASDAQ, Oil, S&P 500, Sector ETFs, Semiconductors, SMH, Transportation, USO