NEW YORK ( TheStreet) -- U.S. stocks surged Friday after shaking off early concerns that the strong jobs growth in June might prompt the Federal Reserve to curb the stimulus measures that have fueled equity markets for more than 18 months months. The S&P 500 gained 1% to close at 1,631.89 while the Dow Jones Industrial Average also added 1% to 15,131.89. The Nasdaq, likewise, advanced 1% to 3,479.38. Investors were initially buoyed on Friday after jobs growth in June beat expectations, lifting the outlook for the U.S. economic recovery. And then, as has become customary in recent weeks, stocks pulled back on concern that better-than-expected jobs growth in June could be cited by the Federal Reserve as a reason to cut-back on the central bank's $85 billion in bond buying that has helped to push investor money into equities. Fed Chairman Ben Bernanke last month signaled that the central bank plans to curb and eventually close its bond-buying program once employment rebounds and the recovery appears to be accelerating. "The market wants to move higher," said Quincy Krosby, market strategist at Prudential Financial. Krosby said it's typical on the day the Labor Department reports monthly nonfarm payrolls that markets instinctively react at the open, "meander" for a part of the session and finally move decisively in one direction when participants have interpreted what they think of the employment report. The Bureau of Labor Statistics reported nonfarm payrolls rose by 195,000 in June as the unemployment rate remained unchanged at 7.6%. Economists polled by Thomson Reuters anticipated non-farm payrolls to have added 165,000 jobs. "Even in fits and starts the numbers have been OK now for about a year," said Tim Holland, portfolio manager at Aston/TAMRO Funds. "The biggest thing is the underlying trend is pretty good -- almost 200,000 a month for a year now is pretty solid." The report upwardly revised May employment numbers to 195,000 from 175,000. The 12-month average sits at 182,000 jobs added per month. But strong labor numbers suggest the Fed could begin to taper its quantitative easing efforts sooner than anticipated. "Bottom line: tapering is in store and we think the September call and $15 to $20
billion to start with is about right," David Ader of CRT Capital Group wrote in a research note on Friday. Helping stocks on Friday after markets closed Thursday in observance Independence Day, was the reaction to a surprise move by European Central Bank President Mario Draghi to offer forward guidance by the central bank. The bank said it doesn't plan to raise interest rates and that it expects key rates to remain at present or lower levels for an extended period of time.
"In what was probably the most dovish press conference by Mario Draghi, the European Central broke with a longstanding practice," Natixis wrote in a research note on Friday. "Mr Draghi added a dovish touch by saying that the recent rise in inflation from 1.4% to 1.6% reflected mainly upward base effects, in effect that these may not last." In corporate news, Lincoln National Corporation ( LNC) was one of the biggest percentage gainers on the S&P 500. The Securities and Exchange Commission reported the company filed a Form 4 that Director Eric Johnson acquired 706.06 phantom stock units to increase his holding to 24,441.05 units. The ex-dividend date for Lincoln National is July 8. Shares were up 4.7% to $38.73. Newmont Mining ( NEM) was one of the biggest percentage losers on the S&P as the gold-mining sector took a huge hit from gold prices plummeting. Gold was dropping Friday as the better-than-expected jobs report blemished the yellow metal's appeal as a safe-haven asset. Shares of Newmont were down 5.5% at $27.43. European markets closed lower on Friday. The FTSE 100 in London slipped 0.72%, and the DAX in Frankfurt was dropping 2.36%. Asian markets closed higher overnight as Japan's Nikkei average closed higher by 2.1% at 14,310. Hong Kong's Hang Seng jumped 1.9% to 20,855. The benchmark 10-year was plummeting 1 25/32, boosting the yield to 2.722%. The dollar was gaining 0.74%, according to the U.S. dollar index. -- Written by Joe Deaux in New York. >Contact by Email. Follow @JoeDeaux