Updated from 4:06 p.m. EDT

Stocks ended at session highs on Wednesday, overcoming a sluggish start amid an earnings warning from Texas Instruments ( TXN).

For the second straight day, the broader market rallied into the close, with the Dow Jones Industrial Average ending up 128.33 points, or 1.4%, at 9183.22. The Nasdaq closed up 18.35 points, or 1.1%, at 1646.02. The S&P 500 rose 12.64 points, or 1.3%, to 997.48.

"The mood is generally positive today, and I think we're seeing a sustained tech rally and people wondering if it's for real or not. Last few days even now and then, the market goes down, but the general trend seems to be positive," said Giri Cherukuri, head trader at OakBrook Investments. "And with interest rates going down, that's helped some too. When they're down, lower borrowing costs and lower interest rates also help consumers, so they can buy more."

Texas Instruments trimmed its revenue and earnings estimates for the second quarter, blaming costly restructuring charges and the SARS virus in Asia. Banc of America Securities cut its rating on the stock to neutral from buy. Shares of Texas Instruments were down $1.53, or 7.5%, at $18.86.

Chip-equipment company Cymer ( CYMI) also cut its guidance. The company lowered its second-quarter revenue estimate by 12% because inventories at semiconductor companies remain high. Shares of Cymer were down $74, or 2.3%, at $31.90.

The dual warnings put pressure on semiconductor names, with Intel ( INTC) falling 9 cents, or 0.4%, to $21.88, and rival Advanced Micro Devices ( AMD) off 27 cents, or 4%, at $6.41. The Philly chipmakers were down 0.6%.

Treasuries reversed direction late in the session as equities rallied, after the yield on the 10-year bond hit the lowest level in nearly 50 years. The 10-year was down 6/32, boosting its yield from 3.15% to 3.21% by the end of the day.

In economic news Wednesday, the Federal Reserve's Beige Book report, a study of economic conditions in the U.S., showed prospects were still mixed. "Although reports from the 12 Federal Reserve districts indicated some signs of increased economic activity in April and May, conditions remained sluggish in most districts," the Fed said.

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