The Nasdaq composite index rose 114.85, or 3.4 percent, to close at 3,499.58, and the Standard & Poor's 500 index climbed 24.76 to 1,407.81.
The Dow Jones industrial average gained 178.19 to 10,545.97, led by United Technologies, which rose $3.75 to $63.50, and Intel.
At the close of regular trading, the chipmaker was up $9.50, or 9 percent, at $115.56. Intel said it will begin hosting data broadcasts, the latest element in its strategy to get into the services business.
Microsoft rose $1.69 to $67.88. The company proposed its own resolution to its antitrust case in response to the government's proposal to break up the software giant.
The CNET tech index gained 83.22 to 2,762.49. Winners edged out losers, with 78 of the 99 stocks in the index rising, 18 falling and three remaining unchanged.
Of the 18 sectors tracked, semiconductor companies posted the biggest gains, climbing about 7 percent. Server hardware makers were the day's largest losers, slipping a slim 0.8 percent.
Entremed was the Nasdaq Stock Market's largest loser, falling $12.63, or 30 percent, to $28.88 on a volume of 2.5 million shares, nearly six times its average daily volume.
Among members of the CNET tech index, Computer Associates International and Micron Technology posted strong gains.
Micron rose $7.69, or 15 percent, to $57.94, while CA climbed $7, or 16 percent, to $51.50. CA said it will report fourth-quarter earnings, which it expects to be in line with analysts' estimates, after the markets close May 15.
VeriSign fell $4.25 to $116.75, Nextel Communications dropped $2.13 to $97.81, and Conexant Systems dipped $1.25 to $40.63
The Philadelphia semiconductor index jumped 56.84, or 6 percent, to 965.78, led by LSI Logic, which gained $4.56 to $47.56, and Micron.
Xerox president and chief executive Rick Thoman has submitted his resignation, according to reports. The company's shares fell $1.75 to $25.75.
Online music company MP3.com has offered an olive branch to the record industry, agreeing to remove all major-label content from its controversial My.MP3.com service. The stock rose $1.38, or 12 percent, to $13.25.