NEW YORK (CNN/Money) - U.S. stocks came out swinging Friday as Intel-inspired technology stocks and a blue-chip bounce on strong jobs data gave investors some cheer at the close of a volatile trading week on Wall Street.

The major indexes erased the previous session's losses but were challenged in the first week of the typically cruel month of September. The Dow Jones industrial average rose 143.50 to 8,427.20. The Nasdaq composite rallied 44.30, or 3.5 percent, to 1,295.30. The Standard & Poor's 500 index added 14.77 to 893.92.

Some analysts said that while the monthly jobs reports was encouraging, it did not dispel market concerns over a stalled economic recovery.

"The jobs number was fuzzy, even though on balance it helped to perk up the market," said Alan Ackerman, market strategist with Fahnestock & Co. "Based on that number, the market is now factoring in that the economy is not weak enough for the Federal Reserve to cut interest rates in its Sept. 24 meeting."

The U.S. unemployment rate fell to 5.7 percent in August from 5.9 percent in July, while job growth gained a little strength as the labor market struggles to recover from more than 1.5 million job cuts last year. Economists had forecast the unemployment rate to remain steady for the month.

Denting the upbeat report was a 68,000-job drop in factory payrolls, the biggest since a 115,000 decline in January, and a 55,000-job drop in retail payrolls.

Technology stocks surged back to life after Intel's much-anticipated mid-quarter update offered no shocks. Blue-chip techs IBM (IBM: up $1.02 to $73.20, Research, Estimates), Microsoft (MSFT: up $1.91 to $47.82, Research, Estimates) and Intel (INTC: up $1.11 to $16.22, Research, Estimates) fueled a blue-chip rally, combined with bullish analysts' notes for chemical maker DuPont and automaker General Motors.

For the week, the Dow was down 2.7 percent, while the Nasdaq fell 1.5 percent. The S&P 500 index dropped 2.4 percent.

The major indexes charted wild gyrations, alternating gains with losses throughout the week on mixed economic reports, tech weakness and foggy back-to-school results from the nation's retailers.

Market watchers forecast more volatility next week -- punctuated by a shortened trading session Wednesday in observance of Sept. 11, the one-year anniversary of the worst terrorist attack against the United States.

"We'll continue to see volatility for two reasons. First, there's no straight line of good numbers continuously coming out of the economy," Alan Kral, portfolio manager with Trevor, Stewart, Burton & Jacobsen, told CNNfn's The Money Gang.

"All this talk about a war with Iraq is adding a tremendous amount of volatility in all the markets. We see it in bonds, gold, oil. The uncertainty of what's going to happen is weighing on the markets," Kral added.

President Bush said Wednesday he would ask Congress at an appropriate time to support any action on Iraq. The president also said he would make his case against Iraqi leader Saddam Hussein in an address to the U.N. General Assembly Sept. 12.

"Next week will be very tense, full of sadness and recollections about Sept. 11 " said Ackerman. "Prudent investors may not want to commit money until after we cross that date."

Stocks traded on moderate volume Friday, which marks Rosh Hashanah -- the start of the Jewish New Year -- typically reflected by sluggish trading late in the session.

Intel (INTC: up $1.11 to $16.22, Research, Estimates) helped to douse the fire that charred the chip sector this week. The No. 1 chipmaker Thursday delivered a mid-quarter update that proved almost anti-climactic after it lowered the top end of its revenue forecast but was still within its estimated range, citing weak demand for chips from customers and businesses.

Wall Street had been bracing for the downbeat business forecast after a slew of analysts delivered cautious comments earlier in the week. Lehman Brothers upgraded Intel to "equal-weight" from "underweight."

Badly bruised semiconductor issues tacked on gains. The Philadelphia Semiconductor Index jumped more than 5 percent to 292.63.

Also supporting the Nasdaq were shares of software, networking and computer stocks.

Blotting the upbeat tech scenario, UBS Warburg lowered its 2002 and 2003 estimates for telecom equipment maker Lucent Technologies (LU: down $0.14 to $1.77, Research, Estimates), citing weakness in the U.S. wireless market in the September quarter. The brokerage firm also said it anticipates more job cuts at the company by the end of the year.

Merrill Lynch chimed in, saying it expects Lucent's fourth-quarter and 2003 sales to decline due to continued weak spending trends.

Asia-Pacific stocks finished lower Friday, with Tokyo's Nikkei index down 1 percent. European markets roared to a solid close.

Treasury prices fell on the back of the strong jobs report, sending the 10-year note yield up to 4.02 percent from 3.91 percent late Thursday. The dollar rose against the yen and euro.

Light crude oil futures rose 63 cents to $29.61. Oil prices had earlier surged by more than $1 a barrel in U.S. trading -- the highest level since Aug. 20, whenprices jumped to $30.32, an 18-month high. Gold hit a 6-week high as investors became increasingly concerned about possible U.S. military action in Iraq.

Market breadth was positive. On the New York Stock Exchange, advancers beat decliners 2-to-1 on volume of 1.1 billion shares. On the Nasdaq, winners beat losers 2-to-1 as 1.2 billion shares changed hands.

Among blue-chip stocks that buoyed the Dow, chemical maker DuPont (DD: up $1.92 to $39.17, Research, Estimates) was upgraded by Bear Stearns to "buy" from "attractive," saying it expects the company to stay on track with its earnings.

The brokerage house also raised its third- and fourth-quarter earnings estimates for U.S. automaker General Motors (GM: up $1.47 to $45.80, Research, Estimates), citing strength in its production schedules, low inventories and signs that the company will continue to push for more market share.

GM Wednesday raised its third-quarter and 2002 earnings forecast following strong U.S. sales for August.

Retail leader Wal-Mart Stores (WMT: up $1.84 to $52.78, Research, Estimates) reaffirmed its third-quarter and full-year estimates. Wal-Mart shares were pummeled in the previous session after the company reported a miss for its August same-store sales number.

Home improvement retailer Home Depot (HD: up $1.15 to $33.25, Research, Estimates) benefited from bullish comments from Credit Suisse First Boston, which said in a research note that a surge in home financing will boost consumer spending. The brokerage firm upgraded the retail sector to "market weight" from "under weight."

But tobacco marketer Philip Morris (MO: down $1.65 to $46.51, Research, Estimates) was a Dow laggard after sector mate R.J. Reynolds Tobacco Holdings (RJR: down $5.67 to $52.58, Research, Estimates), the parent of the No. 2 U.S. cigarette company, slashed its third-quarter and full-year estimates, citing increased competitive pressures. Salomon Smith Barney downgraded R.J. Reynolds to "neutral" from "buy."

Diversified manufacturer 3M (MMM: up $1.90 to $122.63, Research, Estimates) also boosted the blue-chip index.