Coming on the heels of Oracle Corp.'s blow-out second-quarter profit report on Thursday, Research In Motion's upbeat earnings triggered a second day of gains in the tech sector.
"News from the two tech bellwethers helps to ease recent concerns about problems in the financial industry spreading to other areas of the economy like technology spending," said Frederic Ruffy, an analyst at Optionetics.
Hitting new highs for the week, the Dow Jones Industrial Average advanced 157.5 points, or 1.2%, to 13,403.2, setting the blue-chip index in play for a weekly advance of about 0.5%.
Of the Dow's 30 components, 29 were trading higher, led by AT&T Inc. , its stock up 2.4%.
The Dow's sole laggard was Honeywell International Inc. , recently off 0.1%.
The S&P 500 rose 17.61 points, or 1.2%, to 1,477.73, with the S&P standing to rise 0.7% on the week, while the technology-laden Nasdaq Composite gained 35.86 points, or 1.3%, to 2,675.72, positioning it for a weekly gain 9f 1.5%.
Rallying on results, Blackberry maker Research In Motion rose 12% after it reported third-quarter earnings that more than doubled amid strong demand for its products.
Embattled financial stocks drew support from a Wall Street Journal report that investment bank Merrill Lynch & Co. might be the recipient of a capital infusion from Temasek Holdings of Singapore. .
Volume on the New York Stock Exchange surpassed 1.3 billion, and advancing stocks topped those declining more than 2 to 1.
On the Nasdaq, more than 1.5 billion shares traded, and advancers beat decliners 2 to 1.
The government offered mixed news before the bell, with the Commerce Department reporting that U.S. personal spending rose 1.1% in November, while the core inflation rate increased 0.2% for the month. .
"Consumers found their way to the checkout aisles even though their incomes failed to keep pace," said Kevin Giddis, managing director, fixed income, Morgan Keegan & Company Inc.
Also in the capital, the Federal Reserve said it would continue to hold auctions of short-term funds as long as necessary to offset the credit crunch.
And, a monthly survey released by Reuters and the University of Michigan found consumer sentiment revised higher to 75.5 from 74.5 earlier in the month.
On the New York Mercantile Exchange, crude-oil futures gained $2.47 cents to $93.54 a barrel, and gold futures climbed $12.4 to $815.60 an ounce.
Beyond earnings, other developments in the technology sector include a top executive departure from Cisco Systems Inc. , with some analysts taken off-guard by word that Charles Giancarlo, Cisco's chief development officer, is leaving the networking equipment maker. .
Shares of Circuit City Stores Inc. showed their sharpest drop in more than six years, recently down 25.8%, after the second-largest U.S. electronics chain posted wider-than-expected losses for the third quarter, and warned it might tally an unexpected loss in the fourth quarter. .
While Circuit City shares plunged, most other retail stocks held up, with the sector's main indicator, the S&P Retail Index climbing, recently up 0.5%.
Asian markets pulled higher, lifted by gains in consumer-electronics makers. .
In Europe, shares were lifted by gains from technology firms. .
By Kate Gibson