NEW YORK (CNN/Money) -
Technology stocks continued to inch higher Wednesday as strong earnings and an improved outlook lifted the shares of Research In Motion Ltd., the maker of Blackberry wireless e-mail devices.
The tech-dominated Nasdaq Composite index finished 12.86 points, or 0.6 percent, higher at 2,047.79, the Philadelphia Semiconductor index gained 4.64 points, or 1 percent, to close at 485.09.
The Federal Reserve raised interest rates on Wednesday by a quarter of a percentage point, as expected, and hinted that further hikes would come at a gradual pace.
The first rate hike in four years moves the benchmark federal funds rate -- which affects credit costs throughout the economy -- up to 1.25 percent from 1 percent, a 46-year low.
Shares of Research In Motion (RIMM: up $9.07 to $68.45, Research, Estimates) rocketed up more than 15 percent after better-than-expected earnings and forecasts sparked an increase in analyst estimates and stock targets.
The gains come after RIM said red-hot demand for its Blackberry wireless e-mail device lifted quarterly sales by more than 150 percent and boosted earnings to 28 cents a share, after a year-earlier loss of 5 cents a share.
The Waterloo, Ontario-based company also boosted its forecast for the next two quarters.
Shares of Qualcomm Inc. (QCOM: up $1.43 to $72.98, Research, Estimates) added to gains after reaching a three-year high in the previous session, as some investors reacted to the new high and others were encouraged by phone companies' plans to develop high-speed mobile services.
A federal appeals court on Wednesday rejected a bid by Massachusetts' attorney general and two computer industry groups to overturn Microsoft Corp.'s landmark antitrust settlement with the U.S. government.
The U.S. Court of Appeals for the District of Columbia endorsed the 2001 settlement and turned down appeals for stricter sanctions on the world's largest software maker.
The settlement was endorsed by District Judge Colleen Kollar-Kotelly in 2002 and gives computer makers greater freedom to feature rival software on their machines by allowing them to hide some Microsoft icons on the Windows desktop.
Microsoft (MSFT: up $0.06 to $28.56, Research, Estimates) stock edged higher on the ruling.
Among other tech heavyweights, Oracle Corp. (ORCL: up $0.16 to $11.93, Research, Estimates) shares closed higher, while Intel Corp. (INTC: unchanged at $27.60, Research, Estimates) finished flat.
Cisco Systems (CSCO: down $0.01 to $23.70, Research, Estimates) and JDS Uniphase (JDSU: down $0.04 to $3.79, Research, Estimates) both ended Wednesday's session lower.
Shares of Inet Technologies rose sharply on Wednesday after testing-equipment maker Tektronix (TEK: down $0.92 to $34.02, Research, Estimates) said it would acquire the communications software maker for about $325 million in cash and stock.
Inet (INET: up $1.77 to $12.47, Research, Estimates) stock jumped more than 17 percent on the announcement.
-- from staff and wire reports