NEW YORK (CNN/Money) - U.S. stock markets soared in a shortened session Friday, boosted by a relatively trouble-free Fourth of July holiday.

The Dow Jones industrial average jumped 324.53, or about 3.6 percent, to 9,379.50. The Nasdaq composite index rose 68.19 to 1,448.36, or nearly 5 percent. And the Standard and Poor's 500 index rose 35.04, or about 3.7 percent, to 989.03. The gains follow through on a late rally Wednesday, just before the markets closed for Thursday's holiday.

With its biggest gain of the year, the Dow finished in positive territory of the week. But the Nasdaq couldn't overcome earlier losses on Monday and Tuesday and ended down for the week.

Investors have been concerned in recent weeks that the 226th anniversary of U.S. independence would be used to reprise the violence that claimed thousands of lives in New York and near Washington last Sept. 11. But there were no incidents affecting the big celebrations throughout the nation, although a gunman killed two people before being slain himself in an incident at the El Al ticket counter at Los Angeles International Airport.

Peter Mancuso, trader with the Performance Specialty Group, told CNNfn's Market Call the jump is a "knee-jerk reaction" to a terror-free Fourth of July after "terrible" market performance on Monday and Tuesday.

"You're not talking an economic market, you're talking a fear market," Mancuso said. "What are the terrorists going to do? Are there terrorists? Is the government taking care of everything they should be taking care of?"

"We've had so many weeks now of down that it's kind of hard to believe we could have an up day or an up week for the market, but the technician in me is saying this is nothing more than a technical rally," said Barry Hyman, chief market strategist at Ehrenkrantz King Nussbaum.

Unemployment, the most closely watched economic indicator, rose to 5.9 percent, in line with a survey of economists surveyed by Briefing.com. The number of new jobs created only increased by 36,000, rather than the 75,000 expected.

"These top line numbers suggest we are into what's beginning to look like a jobless recovery," Jared Bernstein, labor economist at the Economic Policy Institute, told CNNfn's CNNmoney Morning. "We simply can't drive unemployment down if we're only adding thirty- or forty-thousand jobs. So, basically, we're looking at a situation where the recovery is calling, but the labor market isn't really picking up the phone."

European markets finished broadly higher. Asian-Pacific stocks finished higher, with Tokyo's Nikkei index leading the way.

Treasury prices fell, sending the 10-year note yield up to 4.86 percent from 4.75 percent late Wednesday. The dollar gained against the euro and was little changed versus the yen.

Brent crude oil futures closed up 17 cents to $25.30 in London, where gold was also higher.

Market breadth was positive. On the New York Stock Exchange, advancers led decliners more than 4-to-1 as 698 million shares changed hands. On the Nasdaq, winners topped losers by nearly 3-to-1 on volume of 1.11 billion shares.

Grocery chain Great Atlantic & Pacific Tea Co. Inc., better known as A&P (GAP: up $1.65 to $18.05, Research, Estimates), will restate two years of results and make adjustments to a third following an accounting review, which will result in a $9.5 million aftertax charge.

Semiconductor stocks were strong, led by Micron Technology (MU: up $1.81 to $22.31, Research, Estimates), which benefited from a Goldman Sachs Asia upgrade of the Asian DRAM market. Dow component Intel (INTC: up $1.79 to $19.54, Research, Estimates) was also higher.

Shares of troubled telecom WorldCom (WCOME: up $0.03 to $0.25, Research, Estimates) were heavily traded after a published report said that the Justice Department wants the company to halt its own internal probe ahead of government investigations out of fear of witness tampering. About 130 million shares changed hands.

Business software maker JDA Software (JDAS: down $12.00 to $15.00, Research, Estimates) fell after the company warned that second-quarter results will come in at either 17 cents or 18 cents per share, rather than the 22 cents a share analysts have been expecting.

Qwest International (Q: up $0.12 to $1.82, Research, Estimates) has denied a Wall Street Journal report that it is the subject of a U.S. Justice Department criminal investigation. The telecom service provider has been under Securities and Exchange Commission scrutiny of its accounting practices.

Shares of Vivendi Universal (V: up $1.61 to $17.27, Research, Estimates) rebounded following a change in top management.