NEW YORK (CNN/Money) -
The stock rally accelerated Friday, with the major gauges hitting new highs for the year on Dell's earnings and strong reads on the economy.
The Nasdaq composite (up 24.07 to 2,085.34, Charts) rose nearly 1.2 percent, closing at a nine-month high.
The Dow Jones industrial average (up 69.17 to 10,539.01, Charts) added nearly 0.7 percent, seeing its best close in more than seven months.
The Standard & Poor's 500 (up 10.69 to 1,184.17, Charts) index gained around 0.9 percent, closing at its highest level in 3 years and nearly 3 months.
A strong retail sales number got the market off to a good start, while upbeat news from Dell gave a boost to tech and the Nasdaq.
Stocks managed to build on that throughout the session, although the advance was likely exacerbated by light Friday volume, analysts said.
Stocks rose for the week, too. It was the third weekly gain in a row for the Dow and Nasdaq, the fourth in a row for the S&P 500.
While the session's gains were good, the three-weeks-and-counting rally is showing signs of stalling, said Bryan Piskorowski, market analyst at Wachovia Securities.
"I think it's a decent session, but not great," he said. "Retail sales this morning were good, and that helped, but the volume is fairly low."
"All of our short-term technical indicators are showing that the market is overbought," he said. "Granted, we could get more overbought first, before we see a consolidation, but we are likely to see that consolidation fairly soon."
Retail sales rise
In a good sign for the holiday sales period, October retail sales rose 0.2 percent, the Commerce Department said, in a report released before the start of trade Friday. Sales rose an upwardly revised 1.6 percent in September. Economists surveyed by Briefing.com expected sales to rise 0.1 percent in October.
Sales excluding volatile autos rose 0.9 percent in October versus an upwardly revised 0.8 percent gain in September. Economists expected a rise of 0.6 percent.
The University of Michigan's first read on consumer sentiment for November was released shortly after the open. The index increased to 95.5 from 91.7 in October. Economists thought it would rise to 93.
The report on September business inventories was also released after the open. Inventories rose 0.1 percent after rising 0.7 percent in August. Analysts thought inventories would rise 0.5 percent.
On the move
Dell (up $3.19 to $40.44, Research) reported third-quarter sales and earnings late Thursday that rose from a year earlier and were basically in line with estimates. The PC maker also said it was on track to meet fourth-quarter forecasts and that it could see $60 billion in annual revenue by 2006, a year earlier than it had previously suggested.
Shares rose 8.6 percent and gave a boost to other tech names.
Advanced Micro Devices (up $2.43 to $21.02, Research) added another 13 percent after Dell's CEO said Thursday that the company is considering using AMD chips. Dell is currently rival Intel's top customer.
AMD stock has been rallying for several days amid upgrades from the analyst community, on bets that the chipmaker can continue to take market share away from Intel and other competitors.
After struggling all session, Intel (up $0.52 to $23.69, Research) rose near the close, adding 2.2 percent.
Chips were strong on the session with the Philadelphia Semiconductor (up 9.55 to 423.81, Charts) index, or the SOX, gaining 2.3 percent.
Among other stock movers, Pixar Animation Studios (up $6.60 to $86.54, Research) rose 8.3 percent, closing at an all-time high, one day after the company reported improved third-quarter earnings that trounced estimates, and boosted its current-quarter forecast.
Delta Air Lines (up $0.55 to $6.84, Research) rallied 8.7 percent one day after pilots ratified a $1 billion concession package that could help the troubled airline avoid filing for bankruptcy.
On the downside, beleaguered telecom gear maker Nortel Networks (down $0.34 to $3.03, Research) tumbled for the second session, losing another 10 percent of its value after saying Thursday that it is again delaying filing restated financial results.
Market breadth was positive. On the New York Stock Exchange, winners beat losers by more than 12 to five on volume of 1.52 billion shares. On the Nasdaq, advancers topped decliners three to two on volume of 2.01 billion shares.
Oil prices closed little changed. U.S. light crude for December delivery fell 10 cents to settle at $47.32 a barrel on the New York Mercantile Exchange.
Treasury prices rose, pushing the 10-year note yield down to 4.18 percent from 4.24 percent late Wednesday. Bond markets were closed on Thursday for the Veterans Day holiday.
In currency trading, the dollar fell versus the euro and yen.
COMEX gold rose $3.10 to settle at $438.30 an ounce, a 16-year high.