Rumours that the next generation of Apple's iPod Touch devices could come with intergrated pico projectors are gaining momentum.

Small cap company, Microvision – which has long specialized in the development of micro-projection devices – saw its stock price jump this week after sources reported that it is providing technology for the new iPod Touch.

The shares in the company showed an intital jump of 19 per cent and have continued to rise since Tuesday, currently trading at $2.45.

If the rumours prove true it will be the first commercial Apple product to feature the technology and could pave the way for them to be included in the next generations of iPods and iPhones.

The pico projector – already used in some phones and digital cameras – lets users display pictures they have taken or stored on the devices on walls and other surfaces. Unidentified sources have claimed that the inclusion of a pico projector in the next-generation of Touch devices has already been confirmed by channel checks at manufacturers in Taiwan.

Apple's annual September Media Event – traditionally a platform for the company to reveal its new developments and models – is scheduled to take place in Northern California this week.