On October 2, Credo Technology Group Holding Ltd rose 5.6% in regular trading, trading at $222.25/share, with turnover of $392 million. The rally was driven by a sweeping round of upgrades from Bernstein across the optical communication sector, igniting broad-based bullish sentiment.

Bernstein upgraded Coherent, Lumentum, and Celestica to Outperform, assigning target prices of $350, $1,220, and $520 respectively, while also initiating Ciena at Outperform with a $440 target. The concentrated bullish signals triggered a sector-wide surge, with Coherent soaring 10.90%, Lumentum gaining 7.67%, AXT Inc rising 5.68%, and Corning advancing 4.33%. The Philadelphia Semiconductor Index climbed 1.59%, providing additional support as chip stocks broadly recovered.

The move also extends a rebound from a sector-wide selloff on September 28. Credo reported strong fiscal Q1 results on September 1, with revenue of $479 million (up over 100% year-over-year) and adjusted EPS of $1.20, both beating estimates. Industry tailwinds persist, with 1.6T DSP supply shortages expected to last through the second half of next year, underpinning demand for high-speed connectivity solutions.

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