Updated from 4:07 p.m. EST

Stocks closed with solid gains Friday as traders took a bullish view of the labor market, which continues to generate a steady supply of new jobs.

The Dow Jones Industrial Average rose 104.06 points, or 0.95%, to 11,076.34, and the S&P 500 gained 9.35 points, or 0.73%, to 1281.58. The Nasdaq Composite added 12.32 points, or 0.55%, to 2262.04, breaking a six-session losing streak.

"We spent the week worrying about yields and what the economic data would do," said Art Hogan, chief market analyst with Jefferies. "We managed to work our way through it. We finished off the week the best we could. Next week we have a host of economic data that may or may not change our mind. We'll see how it plays out."

For the week, the Dow rose 55 points, or 0.5%. The S&P 500 lost 6 points, or 0.46%, and the Nasdaq fell 40 points, or 1.76%.

About 1.60 billion shares traded on the New York Stock Exchange, with advancers beating decliners by an 11-to-5 margin. Trading volume on the Nasdaq was 1.77 billion shares, and three stocks rose for every two that fell.

The Dow was boosted by gains of 1.6% or higher in American Express ( AXP), Honeywell ( HON) and American International Group ( AIG).

The 10-year Treasury was down 8/32 in price to yield 4.76% and is now three basis points above the yield of the two-year note. The dollar rose against the euro and fell against the yen.

The Labor Department said the U.S. economy added 243,000 jobs last month, greater than expected, while the unemployment rate rose to 4.8% from 4.7%. The average hourly wage component of the report, which the market follows closely, rose 0.3%, matching expectations.

The number of jobs created in January and December was revised down by 18,000. Bond yields have been steadily rising in the runup to the data as traders fret that too many new jobs will force the Federal Reserve to keep raising rates.

To view Gregg Greenberg's video take on today's market, click here .

"Now we're going to see more pressure on the bond market and an already stressed equity market," said Barry Hyman, equity market strategist with Ehrenkrantz King Nussbaum. "There's a lot of concern and we're seeing some defensive investing. This number shows that the Fed will continue raising rates. Numbers like this show that we're in store for two more hikes."

Robert Pavlik, chief investment officer with Oaktree Asset Managment, agreed that the market will now face at least two more rate increases.

However, "from the optimist's point of view, this report provides clear evidence that the economy is growing at a fairly healthy rate, but not at a rate which needs extreme measures by the Fed to slow things down."

Elsewhere, the Commerce Department said U.S. wholesale inventories rose 0.1% in January, while sales increased by 1%. Economists anticipated a 0.5% rise in inventories.

Oil was lower after rising 43 cents on Thursday amid a rally in gasoline prices. In Nymex floor trading, April crude finished down 51 cents at $59.96 a barrel, the first close for crude below the $60 level in almost a month.

By sector, the Amex Oil index was up 0.6%, and the Philadelphia Oil Service Sector index gained 0.7%. Meanwhile, the Philadelphia Housing Sector index rose 1.5%, and the Philadelphia/KBW Bank Sector index added 0.9%.

Among stocks, telecom supplier Adtran ( ADTN) lowered its guidance, citing weak bookings. Excluding items, Adtran expects to earn 21 cents to 24 cents a share in the quarter, well short of the 31-cent analyst consensus. Adtran fell by $1.21, or 4.3%, to close at $26.73.

AnnTaylor ( ANN) swung to a fourth-quarter profit of $27.4 million, or 38 cents a share, on an 18% jump in revenue. Adjusted earnings of 43 cents a share were 3 cents better than expected. The stock added $2.15, or 6.1%, to $37.48.

Early Friday, Nortel ( NT) said it will delay filing its 2005 annual report until the end of April and that it will restate financial results for 2003, 2004 and the first nine months of 2005.

The restatement comes after an audit found accounting mistakes due to revenue incorrectly recognized in previous periods that should have been deferred to future periods. Nortel lost 7 cents, or 2.3%, to $3.02.

A group including Televisa ( TV), billionaire Gustavo Cisneros and two private equity firms has emerged as a likely bidder for Univision ( UVN), sources told TheStreet.com. The bidding is still in early stages and other suitors are expected.

Univision gained $1.26, or 3.8%, to $34.18. Televisa was higher by 61 cents, or 0.8%, to finish at $77.23.

DreamWorks ( DWA) fourth-quarter earnings fell 67% from a year ago as the animation studio took a writedown on its latest Wallace & Gromit title. Revenue fell to $172.9 million from $496 million. DreamWorks slipped $1.21, or 4.5%, to $25.65.

Storage company McData ( MCDTA) swung to a fourth-quarter profit of 3 cents a share and said revenue rose 72% to $181.8 million. Excluding items, McData earned 8 cents a share, 2 cents better than expected. The stock lost 11 cents, or 2.5%, to $4.32.

Among rating moves, Prudential Equity Group downgraded JetBlue ( JBLU) to underweight from neutral-weight, saying the low-fare carrier has long-term structural issues. JetBlue fell 85 cents, or 7.6%, to close at $10.26.

Overseas markets were mostly higher, with London's FTSE 100 adding 0.9% to 5908 and Germany's Xetra DAX rising 1.3% to 5805. I n Asia, Japan's Nikkei rose 0.5% overnight to 16,116, while Hong Kong's Hang Seng lost 0.4% to 15,445.

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