Wall Street stocks were able to close higher on Friday, as a better-than-expected jobless report failed to convince investors that the worst was over for the American economy.

Shares rose more than 1.1 percent at the open as traders responded to the jobs report. But stocks then stumbled, the dollar strengthened and the markets spend much of the afternoon meandering between gains and losses.

At the close, the Dow Jones industrial average was 22.07 points or 0.21 percent higher. The Standard &&8; Poor&S217;s 500-stock index was up 5.96 points or 0.54 percent, and the Nasdaq was up 21.21 points or 0.98 percent.

&S220;Those numbers caught pretty much everyone flat-footed,&S221; Stephen Wood, chief market strategist at Russell Investments, said of the jobs report, pointing in particular to sharp upward revisions in the data for previous months &S220;This confirms that we&S217;ve moved away from the edge of the precipice where we stood last year, the recovery story is real.&S221;

Stock market investors nonetheless recognize, Mr. wood said that &S220;this is going to be more of a grind upward than a euphoric tide lifting all boats.&S221;

Yet, he noted, the data also could lead the Federal Reserve to move earlier than some analysts had expected to tighten interest rates from their rock-bottom levels. He predicted the Fed would raise its benchmark overnight rate target, the Federal funds rate, to between 0.5 percent and 1.0 percent by the end of 2010.

That possibility bolstered the dollar, which strengthen against other major currencies.

The euro fell to $1.4876 from $1.5053 Thursday, and the British pound fell to $1.6498 from $1.6540. The dollar rose to 89.99 yen from 88.26 yen.

As the dollar rose, crude oil declined, settling down 99 cents at $75.47 a barrel.

The Labor Department said in Washington that the United States lost 11,000 jobs in November, less than a tenth of the roughly 125,000 job losses economists had been expecting. The unemployment rate improved to 10 percent from 10.2 percent in October.

While companies are still shedding workers, the pace was the best since the recession began in December 2007, and suggested to some analysts that the economy is headed toward recovery low fee payday loans.

Jeffrey Saut, chief investment strategist for Raymond James, characterized the November job-loss number as &S220;an outlier.&S221;

&S220;There&S217;s no doubt the recession is in the rear-view mirror,&S221; he said, &S220;but I wouldn&S217;t be surprised to see the jobless rate ticking up again in the months ahead.&S221;

Unemployment, he added, is a lagging indicator, so investors who wait for the labor market to turn around have historically missed out on major market gains.

Lawrence Glazer, managing partner at Mayflower Advisors in Boston, said would-be stock buyers remained somewhat cautious, despite the surprising data.

&S220;You&S217;re not seeing the level of volume to suggest retail investors are convinced,&S221; he said. &S220;There&S217;s still a healthy dose of skepticism in the market, because we&S217;re looking at unemployment at a 25-year high.&S221;

&S220;Investors are still seeing a divergence between Wall Street&S217;s gains and Main Street&S217;s malaise,&S221; Mr. Glazer said. &S220;The market has been anticipating better data all along. The question hasn&S217;t been &S216;is the market pricing in a recovery,&S217; but &S216;is the market pricing in too big of a recovery.&S217;&S221;

Mr. Glazer said institutional investors had already begun to close positions and did not want to be reshuffling portfolios toward the end of the year, damping the effect of the positive surprise.

In other economic news, the Commerce Department reported that orders to American factories unexpectedly rose 0.6 percent in October, which was better than the flat reading that economists had expected.

In Europe, the Dow Jones Euro Stoxx 50 index of euro zone heavyweights settled 1.19 percent higher, while the FTSE-100 index in London was up 0.18 percent. In Asian trading, the Tokyo benchmark Nikkei 225 stock average rose 0.5 percent. European markets had been down before the American jobs report was released.

Dollar Strengthens and Wall Street Tries to Rally