Bonds eased and the dollar edged higher against the yen and euro. The Dow industrial average surged 152.61 to close at 11035.70. The last time the Dow industrials closed above 11000 was September 13, two weeks after hitting an all-time high of 11326.04 on August 25.

Gains for tech component stocks Hewlett-Packard, International Business Machines and Intel accounted for much of the blue-chip averages strength. The tech-heavy Nasdaq Composite Index soared 77.72, or 2.4 per cent, to close at a record 3347.11. Its was the Nasdaq composites 13th record close in the last 16 trading days. The Standard & Poors 500-stock index also closed at new high, rising 14.23 to 1424.94. The New York Stock Exchange Composite Index climbed 4.39 to 648.90.

On the Big Board, where 101.3 billion shares traded, 1,507 stocks advanced and 1,526 declined. Tech stocks reclaimed their leadership role in the market, posting strong gains after Hewlett-Packard beat earnings expectations. Late Wednesday, H-P posted operating net of 75 cents a share for its fiscal fourth quarter, two cents a share better than the estimate of analysts surveyed by First Call/Thomson Financial. Several investment banks raised their ratings on the company's stock on Thursday. H-P, a Dow component stock, surged 17 3/16 to 94 5/8 at 4 pm EST.

Traders said enthusiasm for the initial public offering of Agilent Technologies, H-P's testing and measurement unit, also aided in the sectors advance. Agilent stock closed at 42 1/2, up from its offering price of 30.

Elsewhere in the sector, Applied Materials surpassed Wall Street expectations for the fiscal fourth quarter, posting profit of 77 cents a share. Analysts had expected about 64 cents a share. Additionally, the financial chief of the Santa Clara, Calif, chip maker said he sees first-quarter net of 75 cents to 77 cents a share on revenue of at least $1.6 billion, with first-quarter orders up 10 per cent to 15 per cent from fourth-quarter levels.

Its shares sank 3 to 107. Analysts said investors who had bought on the rumour of strong earnings, were now selling on the news. Nonetheless, the earnings data cheered tech investors, boosting the Morgan Stanley high-technology index 76.49, or 5.1 per cent, to 1565.87.

Bonds slumped for a third straight day, as investors focused on the minutes of the October meeting of the Federal Reserves Federal Open Market Committee. The minutes showed policy makers believed central bank would have to raise US interest rates by November.

Most members continued to view some increase in core price inflation as a definite possibility, the minutes reported. They said that even if the US economy slowed to a growth rate that reflected its historical potential, it would still be at a point where it was consuming more resources than could be considered safe. The report further rattled bond traders, who have begun pricing in a spectre of another rate increase early next year.

Earlier in the day, a report on the US trade gap helped to calm the markets inflation jitters. The trade deficit widened in September to $24.41 billion, as exports of goods and services abroad fell for the first time since May to $81.71 billion.

The data had provided some comfort to bond traders. The rising tide of imports dampens economic growth in the US, and helps keep inflation under wraps by allowing consumers to buy cheaper foreign goods. The bellwether 30-year Treasury bond was down 14/32 point, or $5 for a $1,000 bond. Its yield, which moves in the opposite direction of its price, stood at 6.161 per cent.