NEW YORK (CNN/Money) - Stocks rose Wednesday, lifted by news that President Bush won a second term in office.

The Dow Jones industrial average (up 177.71 to 10,314.76, Charts) and the Nasdaq composite (up 19.30 to 2,023.63, Charts) both added 1 percent. The broader Standard & Poor's 500 (up 18.47 to 1,161.67, Charts) index added 1.1 percent. All three indexes had been higher in the early afternoon, but they lost some steam on an afternoon spike in oil.

Uncertainty about the outcome of the election took its toll on markets in recent months, with polls showing President George W. Bush and Sen. John Kerry neck and neck up through Tuesday's election.

Not only do many Wall Streeters tend to be Republican, but investors had been worried about a deadlock similar to that of 2000.

However, those worries were put to rest Wednesday, with Kerry's late morning concession and Bush's declaration of victory.

"Clearly, we're seeing a Bush victory rally," said Michael Sheldon, chief market strategist at Spencer Clarke.

Beyond Wednesday's initial euphoria, whether stocks can continue to rally through the end of the year -- let alone the end of the week -- depends on a number of variables.

In the short term, the next big event for investors will be Friday's monthly jobs report.

Employers are expected to have added 175,000 new jobs to their payrolls in October, according to Briefing.com estimates. That would be up from 96,000 in September. The unemployment rate is expected to hold steady at 5.4 percent.

"I think market technicals have been improving recently," Sheldon added. "If the jobs data come in line with estimates, I think that will provide the backdrop for further gains through the end of the year."

Next week brings the next Federal Reserve policy-setting meeting, and the central bank is widely expected to boost the Fed funds rate by a quarter-percentage point, its fourth such move this year.

"The market got what it wanted today, but now it has Friday's payrolls report ahead of it, a Federal Reserve meeting next week ahead of it," said Paul Mendelsohn, chief investment strategist at Windham Financial Strategies. "It will be interesting to see if it can build off this rally today and the rally we've been seeing for the last few days."

"All of the problems -- the higher oil prices, the ongoing events in Iraq, the question about interest rates and the economy -- those problems haven't disappeared overnight," he added.

Markets started the morning in rally mode, as Bush led the Massachusetts senator 254 to 252 in the electoral college, with three states -- New Mexico, Iowa, and most notably, Ohio, not yet called. A total of 270 votes are needed for victory.

Although New Mexico and Iowa remained too close to call, Ohio was awarded to Bush by the end of the day, with aides on both sides determining that there were not enough outstanding votes for Kerry to potentially take the state. That brought Bush's tally to 274 votes, enough to secure a victory. (For CNN.com's full coverage of the election, click here.)

"We had a good rally based on the election outcome and it was totally as anticipated," Mendelsohn added.

He said analysts had been expecting the market to gain around one percent on a Bush victory and lose around one percent on a Kerry victory. Additionally, stocks and sectors that were expected to rise if Bush won did indeed rise, including healthcare and defense.

Big pharmaceutical shares rose on relief about Bush's win; Kerry had pledged to limit prices paid for prescription drugs.

Merck (down $0.86 to $27.02, Research) added 4 percent, while fellow Dow stock Pfizer (down $0.39 to $29.06, Research) gained 2.6 percent. Bristol-Myers Squibb (down $0.03 to $23.73, Research) gained 2.5 percent.

Large biotechs also benefited from the Bush win, with Amgen (up $0.45 to $59.00, Research) and Genentech (up $0.14 to $48.89, Research) both rising.

Biotechs that deal in stem cell research plunged on worries that a Bush win would hurt the sector's prospects. Bush has limited the use of stem cells in research and treatment.

Stemcells (down $0.24 to $2.90, Research) fell 23.6 percent in active Nasdaq trade. Aastrom Biosciences (down $0.06 to $1.11, Research) fell 16 percent and Geron (up $0.03 to $6.98, Research) fell more than 12 percent.

Defense and aerospace names gained as well, with investors betting that defense spending will remain at heightened levels under a second Bush term.

Boeing (down $0.56 to $50.59, Research) added 2.5 percent. United Technologies (up $0.94 to $95.95, Research) and Honeywell (up $0.72 to $35.57, Research) both gained as well.

Other big Dow gainers included Caterpillar (up $1.63 to $85.88, Research), Altria (up $4.23 to $54.23, Research) and Johnson & Johnson (down $0.23 to $59.22, Research).

Among other movers, Tommy Hilfiger (up $0.16 to $9.10, Research) fell 5.4 percent, recovering from steeper morning lows. The clothing designer pulled its 2005 guidance and delayed the release of its fiscal second-quarter results, as it looks into questions about payments between units raised by federal prosecutors.

Market breadth was positive. On the New York Stock Exchange, advancers beat decliners three to one on volume of 1.76 billion shares. On the Nasdaq, winners topped losers two to one on volume of 1.96 billion.

In economic news, reports were released after the start of trade on factory orders and the services sector of the economy.

Factory orders fell 0.4 percent in September after falling a downwardly revised 0.3 percent in August. Economists surveyed by Briefing.com expected orders to rise 0.4 percent.

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The Institute for Supply Management's services index rose to 59.8 in October from 56.7 in September. Economists thought it would rise to 58.

Treasury prices fell, but they cut their losses by the close. The 10-year note lost 5/32 of a point in price to yield 4.07 percent, up from 4.05 percent late Tuesday. Treasury prices and yields move in opposite directions.

In currency trading, the dollar fell versus the euro and gained versus the yen.

Oil prices gyrated following the release of the weekly oil inventory data, which showed a large rise in crude inventories.

U.S. light crude for December rallied $1.26 to settle at $50.88 a barrel on the New York Mercantile Exchange.

COMEX gold gained $4.80 to settle at $425.40 an ounce.