NEW YORK (CNN/Money) - Investors found strong reasons to buy stocks Tuesday, seeing signs of a corporate profit recovery in better-than-expected results from chip sector names Texas Instruments and Novellus Systems and No. 1 automaker General Motors.

The Nasdaq composite index added 63.01, or more than 3.5 percent, to 1,816.79. The Dow Jones industrial average gained 207.65 to 10,301.32, a 2 percent rise. Both indexes hit their biggest one-day point gains in six weeks. The Standard & Poor's 500 rose 25.82 to 1,128.37, up more than 2 percent.

After the close of trade, No. 1 chipmaker Intel (INTC: up $1.40 to $29.51, Research, Estimates) said it earned 15 cents per share, excluding charges. The results met estimates and showed a decline of a penny a share from the same period one year earlier. Looking forward, the company said it expects to see revenue of between $6.4 billion and $7.0 billion, when analysts expect $6.7 billion. Shares of Intel rose $1.43, or almost 5 percent, to $30.88 in after-hours trade.

Intel's lack of bad news was seen as a good sign by analysts, as it should give legs to a chip sector rally begun earlier Tuesday by two prominent companies.

"You're seeing in essence the bottom of a cycle. Texas Instruments and Novellus said that today (Tuesday). I think the stock (Intel) is going to go up," John Geraghty, a managing director at Gerard Klauer Mattison told CNNfn's Street Sweep.

Chip processing gear maker Novellus Systems (NVLS: up $3.06 to $53.46, Research, Estimates) reported a narrower-than-expected loss and upped its second-quarter expectations, while mobile phone chipmaker Texas Instruments (TXN: up $1.66 to $33.79, Research, Estimates) reported a lower profit than a year earlier, but nonetheless topped expectations.

A potential recovery in semiconductor equipment is particularly important for technology, said Douglas Altabef, managing director at Matrix Asset Advisors. "Novellus is a chip equipment company, and if they exceed estimates, that means demand for chips is improving, which is a good sign for PC makers, software and other sectors."

But gains weren't limited to technology. No. 1 automaker General Motors (GM: up $2.95 to $64.05, Research, Estimates) reported a first-quarter profit that topped estimates and raised guidance for the second quarter. The company was one of four Dow components reporting results before the opening bell.

Wednesday brings highly-anticipated results from Dow names IBM (IBM: Research, Estimates), JP Morgan Chase (JPM: Research, Estimates), Philip Morris (MO: Research, Estimates), United Technologies (UTX: Research, Estimates) and Boeing (BA: Research, Estimates).

Market breadth was positive on strong volume. On the New York Stock Exchange, winners beat losers by more than 11-to-5 as 1.34 billion shares changed hands. On the Nasdaq, advancers topped decliners 5-to-2 as 1.76 billion shares traded.

General Motors was one of several Dow components offering first-quarter results.

Health products maker Johnson & Johnson (JNJ: up $1.10 to $63.26, Research, Estimates) reported better-than-expected profit that grew from the same period one year earlier. Coca-Cola (KO: up $1.49 to $53.88, Research, Estimates)'s stock rose despite the fact that the soft drink maker's higher earnings missed estimates. But industrial equipment maker Caterpillar (CAT: down $1.34 to $56.65, Research, Estimates) earned 23 cents a share, weaker than its profit a year earlier and less than analysts expected.

Helping the troubled telecom sector, Sprint PCS (PCS: up $2.58 to $12.60, Research, Estimates), Sprint's wireless tracking stock, reported a narrower-than-expected loss and said it is in line to meet expectations looking forward.

"The buying is broad-based, and the movement in some of these stocks is significant, particularly for technology," said John Hughes, market analyst at Shields & Co. "I think we're making some good progress today. It could mean a change in tone."

Treasury prices fell, pushing the 10-year note yield up to 5.18 percent.

European and Asian markets closed higher. The dollar fell against the yen and was stronger versus the euro. Light crude oil futures rose 20 cents to $25 a barrel in New York.

In the day's economic news, the Consumer Price Index, the government's main inflation gauge, rose 0.3 percent in March, below expectations for a 0.5 percent increase. Including the volatile food and energy prices, the "core" CPI rose 0.1 percent, also below estimates. In addition, housing starts fell 7.8 percent in March to an annual rate of 1.65 million units, weaker than expected.

But the news didn't seem to impact the overall belief that the economy is improving.

"We, the investing public, are pretty confident about the economy and we wanted to see it in the numbers," Stephen Porpora, managing floor broker at William O'Neil & Co., told CNNfn's Market Call. "It's the 'show me' market and today, some companies showed us."