Stocks extended gains on Friday with the Dow and the S&P 500 indexes rising more than 2 percent as concerns about the euro zone's debt crisis eased with Italian yields falling sharply.

The Dow Jones industrial average <.DJI> was up 267.58 points, or 2.25 percent, at 12,161.37. The Standard & Poor's 500 Index <.SPX> was up 25.38 points, or 2.05 percent, at 1,265.07. The Nasdaq Composite Index <.IXIC> was up 49.08 points, or 1.87 percent, at 2,674.23.

(Reporting by Angela Moon; Editing by Padraic Cassidy)