Stocks climbed on Wednesday, led by technology and biotech stocks, while declining financial shares reined in the Dow's and S&P's gains after a broad debt ratings downgrade on banks.

Cisco Systems gave support to tech shares after its influential CEO John Chambers said to CNBC television he has seen business level out in the last few months, and its shares jumped almost 2 percent to $19.45.

Qualcomm topped the Nasdaq's major advancers, rising 4.2 percent to $45.26 after Goldman Sachs added the wireless technology supplier's stock to its conviction buy list.

Among biotechs, Celgene Corp also helped buoy the Nasdaq a day after news that its experimental anti-inflammatory drug was effective in a mid-stage study of patients with psoriatic arthritis. Celgene's stock jumped 5.4 percent to $45.44.

But gains in the Dow and the S&P 500 were kept in check after 22 U.S. banks were downgraded by Standard & Poor's.

People are seeing some good values. For today people seem to be selling financials and getting into tech and biotech, said Neil Massa, senior U.S. trader at MFC Global Investment Management in Boston.

Banks are down on the S&P downgrade, but also people are taking profits because (banks) have had such a great run.

Massa said the healthcare sector was lifted as investors saw headwinds in Obama's aggressive healthcare reform, which could hurt drugmakers' earnings.

The Dow Jones industrial average <.DJI> gained 46.10 points, or 0.54 percent, to 8,550.77. The Standard & Poor's 500 Index <.SPX> added 4.96 points, or 0.54 percent, to 916.93. The Nasdaq Composite Index <.IXIC> rose 24.70 points, or 1.38 percent, to 1,820.88.

The S&P 500 is up almost 36 percent from its 12-year closing low of March 9, although on Wednesday it fell below its 200-day moving average -- a crucial technical gauge for market strength -- after closing above it for 12 straight sessions.

In its downgrade of banks, ratings agency Standard & Poor's cited expectations of more difficult operating conditions because of volatile financial markets and tighter regulation.

Financial stocks fell, with the KBW Bank index <.BKX> down 1.2 percent and the S&P financial sector <.GSPF> down 0.6 percent.

Investors also mulled details of U.S. President Barack Obama's financial reform package, which he called the biggest overhaul of the financial regulatory system since the Great Depression.

Among decliners outside the banking sector, shares of FedEx , whose delivery services make it a yardstick for economic activity, fell 0.9 percent to $50.94 after the company reported a larger quarterly loss and gave an outlook well below Wall Street's estimates for the current period.

FedEx definitely caused the market to sell off this morning, said MFC Global's Massa.

The closely watched Consumer Price Index, released before the opening bell, showed inflation is still not a worry.

(Editing by Jan Paschal)

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