NEW YORK – Stocks rose Friday, racking up three straight days of gains, after an exceptionally bullish report on September employment bolstered Wall Street's confidence in the economic recovery.
The blue-chip Dow Jones industrial average rallied 84.51 points, or 0.89 percent, to 9,572.31 while the technology-laced Nasdaq Composite Index jumped 44.35 points, or 2.42 percent, to 1,880.57. The broad Standard & Poor's 500 Index climbed 9.61 points, or 0.94 percent, to 1,029.85.
For the week, the Nasdaq Composite ended with a gain of 4.9 percent, and the Dow finished with a gain of 2.8 percent. Both posted their biggest weekly gains since May. The S&P 500 rose 3.3 percent for the week, its largest weekly gain since April.
The rally helped major market gauges notch their biggest weekly gains in at least four months and helped them retake much of the ground lost in a sharp slide that began last week that pulled them to their lowest levels in at least a month on Tuesday.
The latest economic data helped soothe worries that the economic rebound would be held back by weakness in employment growth, which had been dogging Wall Street in recent weeks.
The government said the number of workers on U.S. payrolls outside the farm sector grew by 57,000 last month, the first time since January that jobs were created and sharply contrary to Wall Street economists' forecasts for a loss of 30,000 jobs. The unemployment rate was unchanged at 6.1 percent.
"The jobless rate was better than expected, and payrolls increased rather than decreased, so overall it is looking better for the economy than many people had expected," said Joe Stocke, managing director and money manager with Stoneridge Investment Partners LLC.
A report on non-manufacturing business activity shortly after the open also landed better than economists' expectations. The Institute for Supply Management (search) 's non-manufacturing survey read 63.3 in September, below 65.1 in August but better than Wall Street's expectations for a 62.5 reading.
Mixed reports in past weeks had rattled investors' confidence that the United States is headed for a sustainable recovery, with the failure of the world's largest economy to create jobs a big focus of worries. Investors feared a dearth of jobs could stall the rebound by reining in consumer spending, a main driver of economic growth.
Employment-related companies surged on the news. Monster Worldwide Inc.(MNST), which operates a career Web site, jumped $2.61, or 10 percent, to $28.50. Robert Half International, a staffing company, rallied $2.14, or 11 percent, to $21.60.
Semiconductor stocks also took flight. Chip equipment provider KLA-Tencor Corp. (KLAC) shot up $3.35, or 6 percent, to $55.98, and rival Applied Materials Inc. (AMAT) jumped 91 cents, or 5 percent, to $19.46. Intel, the world's No. 1 maker of chips, advanced 99 cents, or 3.5 percent, to $29.61, and was the Nasdaq's second-most actively traded stock.
Software maker Siebel Systems Inc. (SEBL) climbed 45 cents, or 4 percent, to $11. The company said it expects quarterly total revenues toward the lower end of its forecast as competition grows, but it backed analysts' profit estimates.
Dow component Hewlett-Packard Co. (HPQ) surged 78 cents, or 4 percent, to $20.30. On Friday, it targeted customers of struggling competitor Sun Microsystems Inc. (SUNW), offering them $25,000 in free services to switch to HP computers that run the Linux operating system.
Starbucks Corp.(SBUX), the world's largest coffee shop chain, rallied 79 cents, or 2.7 percent, to $30.22. The company said sales at company-operated stores open at least a year grew 9 percent in September from a year earlier.
3M (MMM) gained $1.75 to $73.03 after Lehman Brothers raised the stock rating of the maker of Scotch tape to "overweight" from "equal-weight."
The session, however, was not without weak spots.
Medtronic Inc. (MDT) shares fell to a four-month low as investors fretted over an apparent slowdown in sales of the company's profitable line of implantable cardiac devices used to regulate a dangerously rapid heartbeat. It ended with a loss of $2.37, or 5 percent, at $45.88.
Trading was active, with about 1.5 billion shares traded on the New York Stock Exchange and 2 billion traded on Nasdaq.
The Russell 2000 index, a barometer of smaller company stocks, rose 9.08, or 1.8 percent, to 512.28.
Overseas, Japan's Nikkei stock average finished 1.1 percent higher Thursday. In Europe, France's CAC-40 advanced 3.2 percent, Britain's FTSE 100 rose
Reuters and the Associated Press contributed to this report.
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