The Standard and Poor's 500 index and the Nasdaq composite set new highs in New York yesterday as the expected impeachment of President Bill Clinton failed to derail a powerful technology rally.

The Dow Jones industrial average rose as much as 175 points before closing 85.22 points higher at 8,988.85. Just a week ago, the Dow was about 700 points below the November 23rd mark of 9,374.27. The technology-rich Nasdaq composite index added more than 50 points to Friday's record high of 2,086.14, pushing this year's gain above 36 per cent.

The gains came as investors had their first opportunity to react to Saturday's impeachment vote by the House and the end of allied missile strikes on Iraq.