Stocks closed higher on Friday as the latest U.S. jobs report hit the sweet spot with Wall Street traders.

The Dow Jones Industrial Average climbed 372 points, or 1.4% to close at 26,573.75. The S&P 500 advanced 1.4% to 2,952.01. The Nasdaq Composite also gained 1.4% to close at 7,982.47. For the week, however, the Dow and S&P 500 posted a third straight decline. The Nasdaq rose about 0.5% week to date.

The U.S. economy added 136,000 jobs in September, the Bureau of Labor Statistics said Friday. Economists polled by Dow Jones expected an increase of 145,000 jobs. However, the unemployment rate fell to 3.5%, a 50-year low.

Friday's jobs report was solid enough to dampen recession fears, but lackluster enough to keep the Federal Reserve on track to cut rates again later this month. Expectations for a 25 basis-point rate cut were at 79% on Friday, according to the CME Group's FedWatch tool.

"This sounds like a Goldilocks number to me," Steve Grasso, director of institutional sales at Stuart Frankel, told CNBC's "Squawk Box." "It still gives the Fed some room for cover to cut rates. This is as close to a not-too-hot, not-too-cold greeting for the market."

Tech was the best-performing sector in the S&P 500, gaining 1.7% as Apple rose 2.8%. The tech giant's stock rose after Nikkei reported the company is increasing iPhone 11 production by 10%.

Treasury yields briefly jumped before giving back those gains. The 10-year yield last traded at 1.51% after hitting 1.55%.