The Nasdaq's intraday high on Friday came after the monthly payrolls report surprised investors with the addition of 2.5 million jobs in May, providing the clearest evidence yet that the USA economy is headed for a quicker-than-anticipated recovery from lockdowns created to contain the coronavirus outbreak.
The benchmark Dow Jones Industrial Average ended at 27,110 on Friday, up 829 points, or 3.1 percent from the day before.
The broad S&P 500 Index (SPY) of large-cap stocks gained 2.6% to close at 3,193.93.
In technology, Apple (NASDAQ:AAPL) soared 2.3% to all-time highs intraday on signs its services business continues to gather momentum.
US employers added a shocking 2.5 million jobs last month - the largest gain on record - while the unemployment rate slid to 13.3%, the Labor Department said Friday.
The Nasdaq joined the S&P 500 in negative territory, while the blue-chip Dow posted a nominal gain. Overnight sentiment bottomed two days before the S&P 500, and outperformance measured from that date was even more extreme.
Wall Street's rally zooms higher after surprise gain in jobs
Rising U.S. -China tensions and the possibility of second waves of coronavirus infections are other reasons for caution, they say. Labor Department's more comprehensive May jobs report, which is expected to show unemployment soaring to a historic 19.7%.
Many investors in recent months have bet that massive corporations with robust balance sheets will build on competitive advantages and grab market share from smaller rivals struggling to survive the global health crisis. "I think there were a lot of people who felt that the layoffs would be permanent, and it's obvious that there's so much demand that people have to bring people back". "If anything, it suggests we should be looking for more good news next month".
"Something like this builds credibility for what the stock market has been telling you", said Brian Belkin, chief investment strategist for BMO Capital Markets. Boeing shares gave the Dow the biggest boost, rising on hopes of a rebound in air travel after American Airlines and United said they would boost their domestic flight schedules in July. "The one thing I'm still cautious on is this incredible optimism trade is being driven without any earnings yet to support it". Facebook and Netflix both dropped more than 1.6%.
The Stoxx Europe 600 Index rose 1.6 per cent.
Friday's gains put the S&P 500 up more than 45% from a March 23 intraday low and less than 6% from its February 19 record.
In another show of increased confidence, the yield on the 10-year Treasury zoomed up to 0.90% from 0.82% late Thursday.
A report showed that the number of USA workers filing for unemployment benefits eased for a ninth straight week, roughly in line with the market's expectations.