New Zealand were 253-5 at stumps, a 118-run advantage with five wickets in hand, after the stubborn Williamson-Watling partnership recovered the innings from a perilous 159-5
Williamson was on 80, in sight of his ninth Test century, and Watling was on 48, nearing his ninth half century.
However, despite their dogged fight, the odds remained in favour of Sri Lanka pulling off a series-levelling win after losing the first Test in Christchurch by eight wickets.
He was out for 22 while Jimmy Neesham, who scored a century in the India Test, was out for 19.
After McCullum's departure it fell to Williamson to shoulder responsibility for keeping New Zealand afloat.
He was dropped on 29 and again on 60 in an otherwise cautious innings in which the partnership has seen off the second new ball and ensured the Test should extend deep into the fourth day at least.
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