Stocks reversed course higher on Friday, with the Dow rallying back from a 250-point deficit as investors took a disappointing September jobs report in stride.
"Oversold sectors are catching a bid," said Art Hogan, chief market strategist at Wunderlich Securities, referring to biotechnology, energy and materials, which led gains.
The Dow Jones Industrial Average (DJI) rose 200 points, or 1.2 percent, to 16,472. The S&P 500 Index (SPX) added 28 points, or 1.4 percent, to 1,951. The Nasdaq Composite (COMP) climbed 81 points, or 1.7 percent, to 4,708.
"The consistent ability of this economy to create jobs seems to be showing some softness," said Hogan of the September payrolls report. "Last year, on average, the economy was creating 250,00 a month, this year it's 200,000, so on average, we're creating less. The good news is we're creating jobs."
The U.S. economy added only 142,000 jobs last month, substantially below the 200,000 projected by economists. The unemployment rate remained unchanged at 5.1 percent, the Labor Department said Friday.
"A disappointing report, no doubt about it," said Scott Wren Senior Global Equity Strategist at Wells Faro Investment Institute. "There is no wage pressure, the job market is not as tight as people think."
The weaker-than-projected report comes amid softening overseas markets, a stronger dollar and cheaper oil prices hurt U.S. manufacturing and exports.
"It's very hard to find anything redeeming in the whole report," said JJ Kinahan, chief strategist at TD Ameritrade. "Real wages on a percentage basis were flat, and manufacturing was a negative for the month."
Friday's jobs report was seen as reducing the odds of a rate hike by the Federal Reserve before the end of the year, with two more monetary policy meetings set for 2015, the next on Oct. 28.
"Chances of a rate hike by the Fed this year just went way down," Paul Ashworth, chief U.S. economist at Capital Economics, said in a note. "The Fed won't be raising rates until early 2016."