While the

Nasdaq Composite Index

soared to a juicy 2.7% gain and the

Dow Jones Industrial Average

surged to an all-time closing high, Internet stocks also advanced -- though the gains in the sector were very un-Internet-stock-like.

TheStreet.com Internet Sector

index rose 10.29, or 0.9%, to 1108.24. The DOT traded as high as 1129.78, and as low as 1100.36 intraday. It peaked within the first hour of trading. Meanwhile, the Nasdaq Comp surged 2.7%, and the Dow hopped 1.2%, an all-time closing high.

Leading the DOT higher was

Check Point Software Technologies

(CHKP) - Get Report

. It soared 38 3/8, or 19.4%, to 235 15/16. The company's shareholders approved a 2-for-1 stock split.

Stocks overall rallied on tame inflation data and decreased fears of big interest-rate hikes by the

Fed

. The inflation data of yesterday and today, along with traders looking at the sunny side of Fed Chairman

Alan Greenspan's

speech

last night, heartened the market. Traders interpreted the Fed chief's remarks as not being overly hawkish on interest rates as players seemed more confident the Fed will only hike the target on the fed funds rate by 25 basis points on Feb. 2 and not 50 basis points as previously feared.

Today's benign inflation data came via the

Consumer Price Index

. The overall CPI rose 0.2%, one-tenth of a percentage point below the consensus estimate of economists polled by

Reuters

. The core rate, which excludes food and energy prices, rose just 0.1%, as opposed to an expected 0.2% increase.

Meanwhile,

America Online

(AOL)

fell 2 3/8, or 3.6%, to 63 1/8, as did its planned acquisition,

Time Warner

(TWX)

. Time Warner slumped 1 1/2, or 1.8%, to 83 1/4.

AOL's takeover of Time Warner was announced on Monday before the opening. On Friday ahead of the news, AOL closed at 73 3/4, while Time Warner closed at 64 3/4.

Elsewhere in the Net sector,

TheStreet.com E-Commerce Index

gained 1.16, or 1.1%, to 106.36. Online-shopping titan

Amazon.com

(AMZN) - Get Report

fell 1 11/16, or 2.6%, to 64 1/4.

TheStreet.com E-Finance Index

eked out a gain of 7/32, or 0.3%, to 75 19/32.

A couple of foreign Internet plays soared today.

Terra Networks

(TRRA)

hopped 16 1/4, or 20.8%, to 94 1/4.

Merrill Lynch

initiated coverage of Terra, a Spanish-language Net access and content concern, with buy ratings both intermediate and long term.

"While the stock is undeniably expensive, we believe that Terra is 'must-own' in our European Internet basket," according to the Merrill research note on the stock.

Elsewhere, Merrill upgraded Britain's

Freeserve

(FREE)

to intermediate-term buy from accumulate. Merrill maintained a long-term-buy rating on the stock. Freeserve soared 6, or 8.2%, to 78 1/4.