Updated from 3:15 p.m. EST

Blue-chips ended sharply higher and tech shares also rose Wednesday as strength in a hodgepodge of Dow names began to outweigh accounting paranoia.

Preliminary numbers showed the

Dow Jones Industrial Average ended up 196 points, or 2%, to 9941, while the

Nasdaq, buttressed by an earnings affirmation from

Lucent

(LU)

, gained 25 points, or 1.4%, to 1776. The

S&P 500 gained 15 points, or 1%, to 1098.

The Dow's strength came from

Alcoa

(AA) - Get Report

, up 3.86%;

AT&T

(T) - Get Report

, up 4.4%;

Eastman Kodak

(EK)

, up 3.9%;

Disney

(DIS) - Get Report

, up 6.4%;

Honeywell

(HON) - Get Report

, up 5.7%; and

General Motors

(GM) - Get Report

, up 4.5%.

Lucent Chief Executive Patricia Russo soothed technology investors by affirming previously given second-quarter guidance. Last month the company said it expects second-quarter sales growth of 10% to 15% above the first quarter. "We have not seen anything different, and we're 30 days into this

quarter," she told reporters at the company's shareholder meeting in Wilmington, Del. The shares closed up 39 cents, or 7.4%, to $5.68.

The latest company under accounting pressure was

Computer Associates

(CA) - Get Report

. The Islandia, N.Y., software maker is being

investigated by federal regulators for inflating its results, according to articles published in

The New York Times

and Long Island's

Newsday

. Even though the company denied being contacted by the authorities, the stock fell $4.40, or 17.4%, to $20.91.

Meanwhile,

General Electric

(GE) - Get Report

was slightly higher after a story in

The Wall Street Journal

reported that the company will amend its disclosure policy for its financial reports, specifically regarding its GE Capital financial services unit. Shares of GE gained $1.17, or 3.2%, to $37.57.

Amid the volatile corporate news, the Labor Department issued its

consumer price index for January, with the results matching economists' expectations. The index, which measures inflation at the consumer level, rose 0.2%, compared with a 0.2% decline the previous month. The core rate, excluding food and energy, also met expectations, rising 0.2%.

Lehman Brothers analyst Holly Becker weighed in on

AOL Time Warner

(AOL)

, downgrading the stock to

market perform from a buy rating, citing the media titan's lower growth projections for its America Online business. AOL's shares closed off $1.32, or 5.2%, at $24.20.

Elsewhere, Banc of America Securities upgraded

Oracle

(ORCL) - Get Report

to buy from market perform, citing the stock's valuation. The firm believes that an improvement in the economy could lead to database and earnings per share growth of 25% to 30%.

Oracle climbed 72 cents, or 4.9%, to $15.51, but for the most part, software stocks were lower most of the day but then rallied.

Siebel Systems

(SEBL)

sunk 3.2% to close at $30.89.

PeopleSoft

(PSFT)

was down 6% early in the day, but closed up 30 cents at $29.40, while

Veritas

(VRTS) - Get Report

and

BEA Systems

were also lower early then rebounded to close up slightly.

Microsoft

(MSFT) - Get Report

inched higher, gaining 97 cents to close at $59.90.

The Philadelphia Stock Exchange Semiconductor Index was slightly lower a day after January book-to-bill numbers were released. The headline number ticked up from December, but analysts offered mixed views on the report. Separately, chip equipment maker

Applied Materials

(AMAT) - Get Report

said at a technology conference that it expects growth in the second half of 2002. The company also said it is gaining market share in nearly every product category, but specifically in metrology and inspection.

Consumer electronics retailer

Circuit City

(CC) - Get Report

reclaimed some of Tuesday's losses after Merrill Lynch came out in defense of the company. Merrill said there was nothing unusual about the company taking charge to account for extraordinary remodeling costs. Merrill's retail analyst Peter Caruso raised his investment rating on the stock to strong buy from buy, and the stock climbed 10% to $24.32 in today's trading.

Treasuries turned higher around midday. Recently, the 10-year note was up 1/32 to 100 2/32, yielding 4.86%.

Overseas, stocks were mostly lower, with London's FTSE 100 losing 1.3% to 5024 and Germany's Xetra Dax roughly unchanged at 4767. Japan's Nikkei 225 closed down 0.1% to 9834, and the Hang Seng lost 0.8% to 10,749.