Handheld device maker Handspring saw its share price surge by a third on their first day's trading.

The initial public offering in New York raised $200m and came as the recent revival in tech stocks continued.

The Nasdaq market, dominated by tech firms, saw its benchmark index close up more than 1% at 4,064, still 20% down its high for the year, but also about 20% higher than its low points of April and May.

The company's Visor device is a rival to the Palm series and Psion's organisers in the handheld computer market.

Analyst Bruce Kasrel at Forrester Research said of the float: "It shows there's definitely a lot of attention being lavished on handhelds."

Handspring sold 10 million shares, or an 8% stake in the company, for $20 each.

That gave the company a market valuation of $2.5bn.

Global market to grow

The company's shares opened at $27 and hit a high of $28.25, before moving to $26.94.

Handspring's performance compared with Palm's dramatic initial public offering in early March during the height of the tech stock surge.

Its shares floated at $38, rising $165 in its first day of trading.

It later fell back and now trades at slightly more than $27.

Handspring said in a recent filing with the Securities and Exchange Commission that it expected global shipments of handheld computers to grow to 35.5 million by 2003 from 8.2 million units last year.

Sony and Microsoft

Handspring's Visor handheld computers look very similar to Palms.

That may not be too surprising as the firm was founded two years ago by Jeff Hawkins and Donna Dubinsky, the people who invented the original Palm Pilot.

It also licences the operating system from Palm. The main difference is that it has an expansion slot which allows it to be turned into an MP3 music player or mobile phone.

But the upbeat debut came despite Handspring's rivals now stretching beyond Palm to include Sony and Microsoft.

Following the stock market launch, the company is valued at just over $3bn - far less than Palm's $15bn or the $90bn Palm was briefly valued at on its first day of trading.