Intel's recent announcement confirming its commitment to maintaining a majority stake in Mobileye has resulted in a notable surge in Mobileye's stock, reflecting an 8% climb. This move has effectively alleviated investor concerns that arose from earlier reports suggesting Intel might divest its holdings in the self-driving technology company.

Mobileye’s stock performance had been under stress, with a substantial year-to-date decline of 69%. Investor sentiment was further dampened by a 22.5% drop in share price following an earnings report on August 22. Nevertheless, Intel's affirmation has sparked a significant bounce, pushing the stock up by 14.1% to a trading value of $13.27, marking its most substantial single-session gain since June 7.

The market's positive reaction is also underpinned by technical factors. Before the recent uptick, Mobileye's 14-Day Relative Strength Index (RSI) was at 32, suggesting that the stock was nearing oversold territory and potentially primed for a rebound. Additionally, while short interest in the stock remains substantial, it has decreased by 20% over the previous two reporting periods, indicating that fewer investors are betting against Mobileye’s recovery.

Since Intel's acquisition of Mobileye for $15.3 billion in 2017 and the subsequent relisting of shares after five years via an initial public offering, Mobileye has faced headwinds, particularly a reduction in demand for its driver-assistance chips. This decline was exacerbated by market weaknesses in China, prompting the company to lower its annual revenue and profit forecasts in August.

Intel itself is navigating through a challenging period, having had to make strategic adjustments such as job cuts, dividend suspension, and coping with high-profile board member resignations. Nonetheless, a recently announced chip-making deal with Amazon’s cloud division could provide Intel's manufacturing business a much-needed boost, helping it compete more effectively with industry players like Taiwan Semiconductor Manufacturing Co.

The strategic emphasis for both Mobileye and Intel remains steadfast on the future of autonomous driving technology. Intel's declaration underscores its belief in Mobileye's critical role in the advancement and deployment of advanced driver assistance systems, which likely influenced the positive market response seen today.