Winners thrashed losers, with 80 of the 100 stocks in the index rising, 15 falling and five remaining unchanged.
Of the 18 sectors tracked, semiconductor and computer memory storage posted the sharpest gains, rising 6 percent each. PC software producers were the laggard sector, rising only 1 percent. No sector posted a decline.
In the broader markets, the Nasdaq composite index gained 134.77 to 4,717.39, and the Standard & Poor's 500 index added 66.33 to 1,458.47. The Dow Jones industrial average continued the climb it started yesterday, soaring 499.19, or 4 percent, to close at 10,630.60.
Intel closed up $4.88 at $125.06. Microsoft remained unchanged at $95.38. The software company said it will enter into a venture for home buyers.
U.S. Office Products posted a 47 percent gain, rising $1.02 to $3.16 and making it the biggest percentage gainer on the Nasdaq. The company said it will explore options that could include an initial public offering for its Mail Boxes Etc. retail chain.
Peapod, an e-commerce company, was the Nasdaq's largest loser, falling $4.19, or 53 percent, to $3.63 on a volume of 6.5 million shares. The online grocer said it is considering its options after promised funding fell through.
Among members of the CNET tech index, eBay and Adobe posted strong gains.
Adobe rose $10.88, or 13 percent, to $94.44. The company reported higher revenue for its first quarter and posted 47 cents in earnings per share, excluding gains--an increase compared to analysts' expectations of 43 cents, according to a survey by First Call/Thomson Financial.
Shares of Inktomi rose $5.29 to $201.06. Brokerage firm Thomas Weisel reiterated its "strong buy" rating on the company.
Qwest Communications International fell $1.69 to $50. The company announced that it will sell some of its assets to Montana Power for $200 million as part of its merger plans with US West.
The Philadelphia semiconductor index rose 25.78 to 1,227.12, led by Texas Instruments, which rose $11 to close at $158.
Sony yesterday said it will reorganize parts of its electronics business to better realize the company's goal of becoming a "broadband entertainment company." Shares in the company fell $4.94 to $250.
Palm announced that it has created a Japanese subsidiary. The shares fell 19 cents to $55.56.