Stocks rose on Friday, propelling the Nasdaq index to an 11-year high, after January's U.S. employment report sailed past expectations, boosting hopes the world's largest economy has turned a corner.

The broad-based gains also sent the Dow Jones industrial average to near its highest in about four years. The S&P 500 extended its 2012 advance to almost 7 percent.

The U.S. economy created jobs at the fastest pace in nine months in January and the unemployment rate dropped to nearly a three-year low of 8.3 percent.

The unemployment rate is what consumers look at, and when they get good numbers that tends to boost overall confidence in the economy and the way people spend money, said JPMorgan chief economist Anthony Chan.

He said while there were some weak numbers in the employment report, if Main Street is going to get excited and spend as if they are excited, that is good enough for me.

Stocks in the consumer discretionary sector and others associated with an expanding economy led gains on the S&P 500. Industrial shares <.GSPI> rose 1.7 percent and financials <.GSPF> gained 2.3 percent, while discretionaries <.GSPD> added 1.6 percent.

In another upbeat report that signaled a strengthening U.S. recovery, the pace of growth in the services sector unexpectedly accelerated in January to its highest level in nearly a year.

The Dow Jones industrial average <.DJI> gained 139.87 points, or 1.10 percent, to 12,845.28. The S&P 500 Index <.INX> gained 15.98 points, or 1.21 percent, to 1,341.52. The Nasdaq Composite <.IXIC> gained 39.77 points, or 1.39 percent, to 2,899.45.

So far this week the S&P is up 1.9 percent and on track for its fifth week in a row of gains. The Dow has risen 1.4 percent and the Nasdaq, also set for a fifth straight winning week, is up 2.9 percent.

More than half way through earnings season, 60 percent of S&P 500 companies that have reported have beaten expectations according to Thomson Reuters I/B/E/S data.

Tyson Foods Inc rose 5.7 percent to $19.68 after quarterly earnings beat expectations.

Gilead Sciences Inc climbed 8.8 percent to $59.65 a day after announcing promising early results from a trial of a hepatitis C drug. It also posted adjusted fourth-quarter profit below consensus.

(Corrects in second paragraph to say Dow industrials near 4-year, not 5-year high)

(Reporting by Rodrigo Campos; Editing by Kenneth Barry)