Mixed employment data helped Wall Street extend its New Year's rally Friday, as investors saw a slowdown in monthly hiring as a precursor to the end of the Federal Reserve's interest rate hikes. The major indexes surged this week, finishing at their highest levels since mid-2001.

According to preliminary calculations, the Dow gained 77.16, or 0.71 percent, to 10,959.31. The Dow advanced 165 points through Thursday; the average has not closed above 11,000 since June 7, 2001, before the Sept. 11 attacks.

Broader stock indicators had their best finish since May 2001. The S&P 500 was up 11.97, or 0.94 percent, at 1,285.45, and the Nasdaq climbed 28.75, or 1.26 percent, to 2,305.62.

Strong advances for Yahoo Inc. (YHOO) and Google Inc. (GOOG) drove the technology sector, building on the market's energetic start to 2006. An upbeat reaction to International Business Machines Corp.'s (IBM) pension news lifted the Dow Jones industrials within reach of 11,000.

Traders were mostly optimistic about a Labor Department report that employers added 108,000 jobs last month, about half the 200,000 increase forecast by economist and well behind November's 305,000 gain.

The languishing job growth signaled a slowing economy, one reason analysts believe the Fed will soon halt its string of rate increases. But a 0.3 percent jump in hourly wages — topping estimates for a 0.2 percent rise — renewed worries about inflation if that pattern is sustained.

"After the market rallied hard on the Fed minutes earlier this week, the perception had been building that good, but not strong, economic data is positive because that signals the Fed having to raise rates less," said John Caldwell, chief investment strategist for McDonald Financial Group. "It's one of those cases where good news is bad news for the economy."