Data shows strong jobs growth, uptick in jobless rate

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Dow up 1.26%, S&P 500 up 1.36%, Nasdaq up 1.28%

U.S. stocks closed higher on Friday in volatile trade to snap a four-session losing streak as investors wrestled with a mixed jobs report and comments from Federal Reserve officials on the pace of interest rate hikes.

The S&P 500 and the Nasdaq each rose as much as 2% in the early stages of trading while the Dow Jones Industrial Average climbed as much as 1.9% on the heels of the closely watched labor market report, before paring gains and briefly falling into negative territory. The report showed an

uptick in the unemployment rate

in October, indicating some signs of slack may finally be starting to emerge in the job market and give the Fed room to downsize its rate hikes beginning in December.

But the data also showed average hourly earnings rose slightly more than expected, as did job growth, pointing to a labor market that largely remains on firm footing.

Labor market data has been a primary focus for markets as the Fed has repeatedly stated it is looking for some cooling before considering a pause in hikes. Hawkish comments from Fed Chair Jerome Powell on Wednesday increased worries the central bank could keep boosting interest rates for longer than previously expected and put further pressure on stocks.

"This was not a report that shows the rate hikes are starting to take hold," said Shawn Cruz, head trading strategist at TD Ameritrade in Chicago.