Stocks Eke Out Gains

Updated from 4:21 p.m. EDT

Stocks had a rocky session but ended slightly to the upside Friday afternoon as a robust jobs report was mostly overshadowed by lingering fears about the credit markets.

After falling more than 120 points, the Dow Jones Industrial Average rebounded to finish higher by 27.73 points, or 0.2%, to 13,595.10, and the S&P 500 gained 1.21 points, or 0.08%, to 1509.65. The Nasdaq Composite was up 15.55 points, or 0.56%, at 2810.38.

"It was a pretty difficult day to explain, in terms of action," said Robert Pavlik, chief investment officer with Oaktree Asset Management. "The fact that the market finished in positive ground is something to be happy about. However, it's tough to walk away from today feeling great, given the great jobs report. We should've finished much stronger than we did today, and it raises questions leading into next week."

Earlier, a sizable rebound appeared to be in order after the Labor Department's nonfarm payrolls report showed that the economy added 166,000 jobs last month, more than doubling expectations.

"Sustained payroll growth at this pace would keep the Federal Reserve on hold indefinitely, but that's an unlikely prospect," said Ian Shepherdson, chief economist with High Frequency Economics. "This report reflects the relative strength of third-quarter [gross domestic product], and the rise in jobless claims is already signaling softer numbers ahead."

The report also said that the unemployment rate remained unchanged at 4.7%. Average hourly earnings rose 0.2%, slightly below consensus. The September and August data were revised to reflect 10,000 fewer jobs created.