NEW YORK (CNN/Money) - The number of upwardly revised third-quarter earnings forecasts has sharply increased compared with last year and this could help keep stocks rising, especially since earnings warnings have stayed the same.

"I think more companies will increase guidance and the rally will continue," said Brian Finnerty, managing director at Melhado Flynn and Associates.

As of Friday morning, the number of companies warning on third-quarter earnings was neck-and-neck with last year -- with 385 warnings compared with 386 at the same point in 2002, according to tracking firm First Call. But, the number of companies that had revised forecasts to the upside was 20 percent greater than last year. Some 227 companies have raised their outlooks, compared with only 181 at the same point last year.

Analysts attribute much of the jump in positive pre-announcements to an economy on the mend, but also say that cautious expectations on Wall Street are helping companies beat estimates and raise their guidance.

"Right now I think the expectation is that a lot of these companies are meeting muted estimates," said James Park, senior trader at Brean Murray. "I think you'll see earnings guided higher, but that outlooks will be tempered."

Nevertheless, the improved forecasts and better comments have helped spur a rash of positive sentiment in the market-- and that's not over yet, analysts said. As of the close of trading Thursday, the Dow Jones industrial average was at its highest point in 15 months, while the Nasdaq stood at 17-month high.

Many of the economic reports in the past few months have shown improvement. Earnings and pre-announcements have steadily improved quarter-over-quarter so far this year and the consensus on Wall Street is that there are no signs of this slowing in the third quarter.

At the same point in the second quarter, 401 companies had warned and 191 had revised guidance to the upside, which is 15 percent below the current quarter. On the same day in the first quarter, 406 companies had lowered guidance, while 159 had said their earnings would be better than expected, about 30 percent below third-quarter levels, according to First Call.

Warnings season has yet to get into full swing, generally taking off in the final two weeks of the quarter. But some big names have already spoken up.

In late August Intel (INTC: Research, Estimates), the world's top chipmaker, boosted its earnings outlook above Wall Street expectations for the third quarter. On Thursday, the company moved up the low end of its raised revenue guidance for the quarter Meanwhile, both IBM (IBM: Research, Estimates) and Dell (DELL: Research, Estimates) have talked about a better environment in the tech sector.

Other less high-profile companies have also expressed optimism. Chipmaker Cypress Semiconductor (CY: Research, Estimates) said Thursday its third-quarter revenue would beat analyst expectations, citing strong consumer sales.

These comments are indicative of the tech sector, which experts say is likely to see the largest number of upwardly revised forecasts -- and to set the stage for the market's tone.

Technology hasn't been the only sector to dole out improved outlooks; retailers have also stacked up their fair share of lifted forecasts. Kitchen products retailer Williams-Sonoma (WSM: Research, Estimates), department store Nordstrom (JWN: Research, Estimates) both boosted their expectations for the third-quarter and the full year. Consumer products maker Procter & Gamble (PG: Research, Estimates) also was among those that raised its outlook for the quarter.

But with Wall Street all wound up for a strong earnings season, disappointments could hurt that much more.

"The whole atmosphere is not conducive to a drop in expectations, but if it does happen, we'll get a correction the market," said Ned Riley, chief investment strategist at State Street Global Advisors.