Microsoft's shares enjoyed a respite yesterday as dealers interpreted a surprise move by the courts to hear the company's appeal as providing a ray of hope that the computer group might not be split in two.

In early trading the shares reached $70 (£43), up more than $3 but still well below the $120 at which they were changing hands six months ago.

One analyst said the mood had swung strongly in Microsoft's favour after the appeal court in Washington indicated it wanted to be given the chance to consider the appeal by Microsoft.

This was because the appeal court had ruled in Microsoft's favour on two other occasions during the three-year legal wrangle.

The stance taken by the appeal court came late on Tuesday when Microsoft's lawyers took the first steps towards asking for a stay to the landmark ruling made by Judge Thomas Penfield Jackson last week which set out stern action against Microsoft on anti-competition grounds.

It appears to complicate the sequence of the potential appeal, which the government has indicated it would like to see take place in the supreme court, the highest in the US. Legal experts suggested that the unusual move by the appeal court might deter the supreme court from deciding to hear the case if the lower court were able to hear it more quickly.

However, Judge Jackson, who appears to have infuriated Microsoft by giving interviews before handing out his final ruling, could still ask the supreme court to take the case. The appeal process is still far from certain and could still take months to be concluded, a factor acknowledged by Bill Gates, Microsoft's chairman.

"Our position is simple. This is a case that will be decided by a higher court," he said. "The principles that apply in terms of 'was Microsoft's behaviour pro-competitive in every respect?', that's already been stated in every respect."

He said that an appeal was a standard right in the US. "It's hard to say exactly -probably in the order of 12 months before a decision comes down," he added.

Microsoft is arguing that the judge's ruling, and his determination that his order should take effect in 90 days, would have "far reaching and irreversible consequences".

The computer company is claiming that the judge committed "an array of serious substantive and procedural errors that infected virtually every aspect of the proceedings".