NEW YORK (CNN/Money) - Stocks gained Wednesday on technology buying and relief after the Federal Reserve left interest rates and its views on the economy unchanged, but an extension of any such gains Thursday seems doubtful.

Uncertainty about the economy and Iraq after President Bush's State of the Union speech Tuesday night put a cap on the advance Wednesday. And despite Wednesday's modest gains, the same concerns remain.

In the latest quarterly earnings news, after the close of trade, CNN/Money parent AOL Time Warner (AOL: Research, Estimates) reported a fourth-quarter profit of 28 cents a share, excluding special items, a little better than expected. However, the results included a much larger-than-expected charge to cover the loss in value of the company's America Online and other business units. Shares of the stock fell $1.23 to $12.73 in after-hours trade.

Additionally, the company announced that Ted Turner will step down as vice chairman.

Thursday brings earnings from Dow components Boeing (BA: Research, Estimates), Exxon-Mobil (XOM: Research, Estimates) and International Paper (IP: Research, Estimates) before the opening of trade and Walt Disney (DIS: Research, Estimates) after the close.

Investors will also take in weekly jobless claims figures and the revised reading on fourth-quarter gross domestic product.

On Wednesday, the Nasdaq composite (up 15.88 to 1358.06, Charts) gained a little more than 1 percent, while the Dow Jones industrial average (up 21.87 to 8110.71, Charts) and the S&P 500 index (up 5.82 to 864.36, Charts) were only slightly higher. Although the gains were modest, they were still a big improvement from the early part of the session, when the market sold off sharply.

Investors took a "no news is good news" approach to the Fed's decision to make no changes in its bias or the fed funds rate. Some on Wall Street had expected the Fed to change its bias -- its view of the direction of the economy -- to imply weakness and that a further lowering in short-term interest rates might come this year. But the central bank left interest rates unchanged and said in its statement that the risks for the economy were equally weighted toward weakness and inflation.

Iraq and the economy dominated Bush's address to the nation Tuesday night and Wall Street initially reacted with great trepidation at the prospect of war and wariness about the administration's plans for repairing the ailing economy. But those concerns abated as the day went on and stocks shook off their early weakness.

Bush gave no timeline for an attack on Iraq, but said he would send his secretary of state, Colin Powell, to the United Nations Feb. 5 to argue for stronger measures against Iraqi President Saddam Hussein. U.N. weapons inspectors are due to deliver a follow-up report on their findings in Iraq Feb. 14.

"A lot of the reason for the rally is that people think that everything's on the table," said Tom Schrader, head of listed trading at Legg Mason. "You saw a knee-jerk reaction this morning, with people selling on an initial reaction to the news, Europe being down so much and some weak earnings, like Kraft."

A late session surge in technology following some positive news in the semiconductor and software sectors enabled the Nasdaq to lead the charge higher.

"The market is technically oversold, so you could see a short-term bounce. But without a resolution to the Iraq question, you're not going to see anything substantial," said Robert Philips, chief investment officer at Walnut Asset Management.

Gains in select technology shares helped the market recover from its early losses. Software and semiconductor issues were particularly strong.

Shares of memory chipmaker Rambus (RMBS: up $4.25 to $11.69, Research, Estimates) surged more than 50 percent after a federal court threw out rival Infineon Technologies' fraud claim against the company and revived Rambus' claim that Infineon had infringed its patents.

Shares of chip gear maker Applied Materials (AMAT: up $0.36 to $13.60, Research, Estimates) also rose after Prudential upgraded the stock to "buy" from "hold," saying that the stock is undervalued.

The gains helped boost sector mate Intel (INTC: up $0.63 to $16.66, Research, Estimates), which trades on both the Dow and Nasdaq.

Shares of software maker Novellus Systems (NVLS: up $2.08 to $31.61, Research, Estimates) gained after the company reported a solid fourth-quarter report late Tuesday.

Among the day's other gainers, Verizon (VZ: up $1.60 to $37.65, Research, Estimates) added 4 percent after it reported fourth-quarter results that beat expectations and canceled plans for an initial public offering of its Verizon Wireless unit.

But on the downside, shares of Kraft Foods (KFT: down $4.91 to $31.20, Research, Estimates) plunged more than 13 percent after the company said its 2003 earnings would fall short of estimates, even as it reported a 70 percent jump in its fourth-quarter results.

Altria (MO: down $1.35 to $37.03, Research, Estimates), or what used to be known as Philip Morris, tumbled on Kraft's news as Altria owns 84 percent of Kraft. News of Altria's own results did little to lift the stock, which closed 3 percent lower. The company reported a lower fourth-quarter profit that edged estimates by a penny.

Celestica (CLS: down $2.79 to $11.95, Research, Estimates)'s stock lost 19 percent and was one of the ten most-actively traded issues on the New York Stock Exchange. The maker of electronic parts for IBM, Microsoft and other technology behemoths reported worse-than-expected fourth-quarter results that fell from the year earlier. The firm also warned that although sales should pick up in late 2003, its business in the first half of the year will continue to suffer due to the slowdown in the technology sector, and that it may have to cut more jobs.

(For a roundup of the day's earnings reports, click here.)

Dow stock Exxon Mobil (XOM: up $1.19 to $33.85, Research, Estimates) trended higher after Prudential Securities raised its rating on several oil stocks and the group as a whole. Prudential raised the group's rating to "market outperform" from "market underperform," saying that the stocks have been underperforming even as oil prices have been rising.

Market breadth was mixed. On the New York Stock Exchange, advancing issues outnumbered decliners by a small margin on volume of 1.56 billion shares. On the Nasdaq, losers just barely edged gainers as 1.46 billion shares traded.

Bonds fell after the Fed announcement, pushing the yield on the benchmark 10-year Treasury note up to 4.02 percent from 3.97 percent late Tuesday. Treasury prices and yields move in opposite directions. The dollar weakened slightly against the euro and gained a little versus the yen.

Among key commodities, light crude oil futures gained 96 cents to $33.63 a barrel. Gold fell $3.70 to settle at $367.40 an ounce in New York.