NEW YORK (TheStreet) -- Stocks turned positive by mid-morning Friday as a blowout nonfarm payrolls report reinforced views first-quarter softness was an aberration and not indicative of a fundamental slowdown in the U.S. economy. Gains were limited, though, as the jobs report heralded fears the Federal Reserve will feel more confident raising rates sooner than later. 

The S&P 500 was up 0.1%, the Dow Jones Industrial Average gained 0.05%, and the Nasdaq added 0.05%.

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.

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 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."

Bank stocks rallied on rate hike speculation. Bank of America (BAC) was up 2%, Citigroup (C) added 1.6%, Morgan Stanley (MS) climbed 1.2% and JPMorgan (JPM) jumped 1.5%. 

Treasury yields spiked on the jobs report with the U.S. 10-year yield jumping to a year-to-date high of 2.435%. 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. 

The 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. Economists had widely expected that outcome. West Texas Intermediate crude was up 0.3% to $58.15 a barrel after selling off on Thursday.

Greece will miss its repayment due Friday of 303.3 million euros to the IMF and instead repay its four debt obligations in a lump sum at the end of the month. This will allow the debt-ravaged country more time in which to negotiate for extra debt relief from its European creditors. Greece needs to repay the IMF nearly 1.6 billion euros ($1.75 billion) this month.

Dow Chemical (DOW) has defended its CEO Andrew Liveris after Reuters reported he is being investigated by the Securities and Exchange Commission, reportedly for alleged use of company funds for personal use.

Gap (GPS) shares were on watch after the company reported comparable-store sales down 1% in May. Its Old Navy brand was the only arm to report growth.

Diamond Foods (DMND) jumped 7% after swinging to profit in its third quarter. The company earned 23 cents a share, better than an expected profit of 14 cents a share. 

Vodafone (VOD) confirmed it held talks with Liberty Global (LBTYA) to discuss possibly exchanging some of its businesses in Europe. The company said it had not discussed a merger or acquisition.

Yahoo! (YHOO) announced it will shut down some of its services, including Yahoo Maps and Yahoo Mail, as it works to refocus on its search business and digital publishing.

Wal-Mart (WMT) shareholders elected Greg Penner as its new chairman at an annual meeting at the University of Arkansas on Friday. Rob Walton will remain as director. Click here for more. 

Computer Sciences (CSC) was slightly lower on news the SEC had charged the company and former executives with accounting fraud. 

Stocks sank deep into the red on Thursday as markets sorted through a range of macro worries, including nerves over the jobs report. The S&P 500 and Dow lost nearly 1%. Click here for more.

More from Markets

Dow Sinks for Eighth Straight Session; Intel's CEO Departs -- ICYMI

Dow Sinks for Eighth Straight Session; Intel's CEO Departs -- ICYMI

Dow Logs Eighth Straight Drop as Stocks Slump

Dow Logs Eighth Straight Drop as Stocks Slump

This Is What's Hot Thursday - Stocks Slide, Intel's CEO Woes & Major Movers

This Is What's Hot Thursday - Stocks Slide, Intel's CEO Woes & Major Movers

U.S. Banks Pass Fed 'Stress Test' With Room for Dividends, Buybacks

U.S. Banks Pass Fed 'Stress Test' With Room for Dividends, Buybacks

U.S. Drillers at Mercy of Iran, Saudi Production Spat as OPEC Meeting Begins

U.S. Drillers at Mercy of Iran, Saudi Production Spat as OPEC Meeting Begins