NEW YORK (CNN/Money) - Stocks rallied Thursday, jumping off sharply depressed levels as some of the hardest hit sectors of the past six weeks attracted buyers, while a solid profit report and forecast from Yahoo! helped boost the tech sector.

"This was a tremendous day for the markets. Not so much that we had a 200-something point day on the Dow, but that the volume was so good. A lot of institutions were sitting on some cash and said, 'OK, this is a good place to get in'," John Pickett, a market specialist at LaBranche & Co., told CNNfn's Street Sweep.

For the day, the Dow Jones industrial average (up 247.68 to 7533.95, Charts), and the Standard & Poor's 500 index (up 27.16 to 803.92, Charts) each rose more than 3 percent. The Nasdaq composite (up 49.26 to 1163.37, Charts) surged 4.4 percent, its seventh best percentage gain of 2002.

The Dow closed at its lowest level in nearly five years Wednesday, a session that brought the major indexes down to levels making the bear market the worst the country has seen since the Great Depression.

Still, some investors doubted Thursday's rally would continue.

"I don't think fundamentally anything has changed from the pessimism of yesterday," Matt Brown of Wilmington Trust told the Associated Press. "The fact is, there are still declining earnings estimates. That, along with the uncertainty of an Iraqi war and the terrorism threat, makes it difficult for the market to get moving again."

Even LaBranche's Pickett said money managers were "dipping a cautious toe in, and I'm sure they are still holding a lot of cash on the sidelines, waiting to see how earnings come in."

The major indexes have closed lower for the last six weeks. Thursday's action put them in position to potentially break that trend this week. For the week, the Dow is currently up about five points, the S&P 500 is up three and the Nasdaq composite is up about 23 points.

On Friday, the market is expected to take its cue from the Commerce Department's September retail sales data and the preliminary October reading from the University of Michigan on consumer sentiment.

The period of reporting quarterly results also heats up Friday with the release of General Electric's (GE: up $0.60 to $22.60, Research, Estimates) profit report, due out before the market opens. The conglomerate and Dow component is expected to have earned 41 cents per share in its most recent quarter, up from the 35 cents per share it earned a year earlier.

The stock has been under pressure of late after several brokerage firms cut their profit estimates for the company, due to worries about high operating costs and reduced earnings growth potential amid a weak economy. Merrill Lynch joined the list Thursday, downgrading the stock to "neutral" from "buy."

A broad range of stocks rose Thursday, with buying in software, Internet, chips, telecom and data storage lifting the Nasdaq composite, while 29 of the 30 Dow industrials closed higher.

A better-than-expected profit report from Web media company Yahoo! and a strongly positive profit forecast from insurer Aetna added to the positive sentiment.

Stock gains also increased somewhat after reports surfaced in late afternoon that the House of Representatives voted to give President Bush the power to launch a military attack on Iraq. The Senate is expected to make the same move either later Thursday or early Friday. The Bush administration has said that it will not necessarily take such action, but wanted to send the message that the United States is speaking with "one voice."

Uncertainty about the threat of Iraq and what action might be taken has been responsible for a lot of the stock selling over the last few weeks.

Internet stocks rose after Web media company Yahoo! (YHOO: up $2.29 to $12.27, Research, Estimates) reported a third-quarter profit of 5 cents a share late Wednesday, a penny above estimates, and raised its revenue forecast for 2002.

Semiconductors rallied after memory chip maker Rambus (RMBS: up $0.20 to $4.20, Research, Estimates) reported fiscal fourth-quarter earnings of 6 cents a share late Wednesday, a penny better than expected, on revenue that declined slightly from the year-earlier period.

Dell Computer (DELL: up $0.71 to $25.71, Research, Estimates), Intel (INTC: up $0.72 to $14.18, Research, Estimates) and Cisco Systems (CSCO: up $0.52 to $9.75, Research, Estimates) all pushed higher, pulling their respective sectors up in tandem.

Among the Dow stocks moving the market, aerospace parts maker United Technologies (UTX: up $2.96 to $52.15, Research, Estimates) gained after the company said late Wednesday that it expects its total 2002 share buybacks to total $700 million, $100 million more than previous guidance. News that a company is buying back its shares often increases buying interest in the stock as it is perceived as a sign of corporate confidence.

Shares of automakers also rebounded after being hurt by brokerage firms' profit concerns in the first half of the week. General Motors (GM: up $2.11 to $33.12, Research, Estimates), Ford Motor (F: up $0.45 to $7.60, Research, Estimates) and DaimlerChrysler (DCX: up $2.04 to $32.21, Research, Estimates) all shot higher.

And, at a time when investors are worried about declining profits, news that Aetna (AET: up $5.11 to $36.80, Research, Estimates) will see far better-than-expected results in its third quarter and full year offered some much-needed encouragement. The U.S. health insurer said that third-quarter profit will be twice what analysts were expecting due to higher premiums and the effect of a decline in medical costs.

A stronger-than-expected weekly jobless claims number also gave stocks some support. The number of Americans filing new claims for unemployment last week fell 40,000 to 384,000 from a revised 424,000 the previous week. Economists were only expecting a dip to 411,000. However, the labor market is still struggling, with the more reliable four-week moving average coming in at 412,250.

Despite so much generally positive news, some market participants didn't see the advance as anything more than an aberration.

"This is purely a technical rally. There is no economic news, no company or sector-specific news that's causing this," said Tim Heekin, head of stock trading at Thomas Weisel

"Whether this is sustainable remains to be seen," Heekin said.

Case in point: retail. The stocks recovered most of their losses in the general upswing, but concerns about a slowdown in consumer spending still loom.

A number of store chains said Thursday their sales in September were weak and forecast further softness in the current quarter. Wal-Mart Stores (WMT: up $0.90 to $51.64, Research, Estimates) typified the experience of many retailers. The world's largest retailer said September sales at stores open a year or more rose only 3.3 percent from the same period one year earlier, when sales rose 6.3 percent.

The year-earlier period included the weeks just after Sept. 11, when sales were hit hard by the fallout from the terrorist attacks against the United States. Analysts had been expecting retailers to see better growth this year, but the slowdown in the economy and the recent West Coast port dispute have undermined these expectations.

Friday's September sales data will be particularly relevant in light of these concerns, analysts said.

Treasury prices fell sharply, pushing the 10-year note yield up to 3.65 percent. The dollar was stronger against both the euro and the yen.

Light crude oil futures fell 38 cents to $28.97 a barrel. Gold declined sharply.

Market breadth was positive on strong volume. On the New York Stock Exchange, advancers beat decliners by 5-to-3 as 2.02 billion shares changed hands; the NYSE hasn't passed the 2 billion-share mark since July. On the Nasdaq, winners beat losers by more than 10-to-7 as 1.81 billion shares traded.