NEW YORK (TheStreet) -- Stocks were caught in a tug-of-war on Friday as optimists and pessimists debated whether a blowout nonfarm payrolls report was a good thing or not.
The S&P 500 was down 0.15%, and the Dow Jones Industrial Average fell 0.31%, while the Nasdaq rose 0.18%. All benchmark indexes closed with weekly losses with the S&P 500 down 0.69% and the Dow down 0.89%.
For economists, the jobs report reinforced views first-quarter softness was an aberration and not indicative of a fundamental slowdown in the U.S. economy. On the other hand, the jobs report heralded fears the Federal Reserve will feel more confident raising rates sooner than later. Click here for more.
The numbers were "certainly more supportive of the first quarter being an aberration than indicative of a slowing trend," said Eric Wiegand, senior portfolio manager at the Private Client Reserve at U.S. Bank, in a call. "The numbers verify that there is growth out there and that the growth is firming ... That should hopefully bolster consumer confidence and have some follow-through into retail sales."
The U.S. economy added 280,000 jobs in May, the Labor Department said Friday, further proof a weak March number was an aberration in a soft first quarter. Economists had expected the economy to add 210,000 jobs in May. April's jobs number was revised down to 221,000 from 223,000. Click here for more (payroll).
The unemployment rate ticked up to 5.5% from 5.4%. Hourly earnings rose 0.3% in May, adding to a 2.3% annual rate. The labor force participation rate increased to 62.9% from 62.8%.
The U.S. economy looks ready for rate liftoff later this year, New York Fed President William Dudley said in a speech to Economic Club of Minnesota on Friday. Dudley said he would back a decision to normalize monetary policy in 2015 so long as the "labor market continues to improve and inflation expectations remain well-anchored."
Bank stocks rallied on rate hike speculation. Bank of America (BAC) - Get Bank of America Corp Report was up 2.4%, Citigroup (C) - Get Citigroup Inc. Report added 1.6%, Morgan Stanley (MS) - Get Morgan Stanley (MS) Report climbed 1.5% and JPMorgan (JPM) - Get JPMorgan Chase & Co. (JPM) Report jumped 1.6%.
Treasury yields spiked on the jobs report with the U.S. 10-year yield jumping to a year-to-date high of 2.435% earlier in the day. The gains added to a total increase of 26.9 basis points earlier in the week as Treasuries sold off, leading yields to notch their biggest three-day gain since June 2013.
Likewise, the U.S. dollar gained against a number of international currencies, including the euro, Japanese yen, British pound and Aussie dollar.
Crude oil prices staged a late-day rally on Friday with West Texas Intermediate closing 2% higher to $59.13 a barrel. The commodity was 1.9% lower for the week, its first weekly loss in 12 weeks after a selloff on Thursday.
Earlier moves had been muted after Organization of Petroleum Exporting Countries maintained its production target after meeting in Vienna on Friday. The group held production at 30 billion barrels a day despite the global oil market having seen prices plummet since last July.
"This outcome was widely expected ... but the announcement re-instills in us the certainty of a perpetuated oil glut going forward," said Daniel Holder, commodity analyst at Schneider Electric.
The telecom sector was the worst performer on Friday as Verizon Communications (VZ) - Get Verizon Communications Inc. Report, down 1.8%, dragged on the Dow. AT&T (T) - Get AT&T Inc. Report dropped 2%, Vodafone (VOD) - Get Vodafone Group Plc Sponsored ADR Report fell 1.8%, and Sprint (S) - Get SENTINELONE, INC. Report tumbled 0.9%.
On the economic calendar next week, Sears Holdings (SHLD) and H&R Block (HRB) - Get H&R Block, Inc. (HRB) Report will report on Monday; Burlington Stores (BURL) - Get Burlington Stores, Inc. Report, HD Supply Holdings (HDS) - Get HD Supply Holdings, Inc. Report, Lululemon (LULU) - Get Lululemon Athletica Inc (LULU) Report and Restoration Hardware (RH) - Get RH (Restoration Hardware) Report are due for Tuesday; Krispy Kreme (KKD) and Men's Wearhouse (MW) will report Wednesday; and Exone (XONE) - Get ExOne Co. Report is due for Thursday.
While there are no major economic data releases as critical as Friday's jobs report, there is still a lot for savvy investors to sort through next week. On the agenda, the JOLTS report, a favorite of Fed Chair Janet Yellen, will be released on Tuesday.
The Energy Information Administration will release weekly oil inventories numbers on Wednesday and weekly jobless claims and retail sales for May are slated for Thursday. May producer prices data is set for Friday morning.