U.S. stocks rose in volatile trade on Friday as investors saw a buying opportunity following the sharp sell-off that took the S&P 500 down 10 percent over the last 10 sessions.

The stock market extended its rebound after Italian Prime Minister Silvio Berlusconi said his country will introduce a constitutional principle of a balanced budget, adding that: "We will accelerate measures" in an austerity program, with the "aim of a balanced budget in 2013."

Helping the market, sources said the European Central Bank was ready to buy Italian and Spanish bonds if Berlusconi commits to bringing forward specific reforms.

"You are making or have made a tradeable low and are going to get a throwback rally," said Jeffrey Saut, Raymond James Financial chief investment strategist, in St. Petersburg, Florida.

At Thursday's close, the S&P 500 was down about 10 percent for the last 10 trading sessions.

Stocks had been lower for much of the day as worries about slower global growth remained firmly intact despite stronger-than-expected U.S. jobs data.

Intense recent selling -- taking both the Dow and the S&P 500 down 4 percent and the Nasdaq down 5 percent on Thursday -- reflects frustration with politicians' inability to address pressing concerns over high public debt in Europe and the United States as growth in the world's large industrial economies shows signs of stalling.

Slower growth in manufacturing and services in the United States also have renewed concern about another U.S. recession.

Among the day's best-performing sectors were defensive ones: consumer staples and health care. The S&P consumer staples index was up 2 percent.

The Dow Jones industrial average was up 132.33 points, or 1.16 percent, at 11,516.01. The Standard & Poor's 500 Index was up 11.07 points, or 0.92 percent, at 1,211.14. The Nasdaq Composite Index was up 4.86 points, or 0.19 percent, at 2,561.25.

U.S. non-farm payrolls data showed a gain of 117,000 jobs in July compared with a forecast for an increase of 85,000, while the country's unemployment rate dipped to 9.1 percent last month from 9.2 percent in June, the Labor Department reported.

Also affecting stocks was talk of a possible S&P downgrade of U.S. debt after the close.

The recent steep sell-off has put all three major indexes in negative territory for the year.

Credit Suisse on Friday reduced its year-end view on the S&P 500 to 1,350 from 1,450, citing weaker-than-expected growth.

Other strategists saw the bearish mood as more temporary.

"If this is a market reaction to a crisis, then a bounce should be under way soon. Since WWII, there are only three instances where U.S. stocks fell 10 percent in 10 days outside of recessions," according to JPMorgan Chase strategist Thomas Lee, in a research note.

Reflecting the market's volatility, the CBOE Volatility Index or VIX whipped between positive and negative in early afternoon trading. It was last up 0.2 percent at 31.71, after earlier touching an intraday high at 39.25, its highest level since May 2010.

(Reporting by Caroline Valetkevitch; Editing by Jan Paschal)