The S&P index recorded 18 new 52-week highs and no new low, while the Nasdaq recorded 56 new highs and no new low.
Market participants now turn their focus to the U.S. Federal Reserve, at whose monetary policy meeting next week the latest jobs data will nearly certainly be discussed.
Besides, while the tech-heavy Nasdaq Composite joined S&P 500 in to the negative territory, the trade-sensitive Dow had also ended up the day with a whiplash. That raises optimism that Friday's more comprehensive jobs report from the US government may also not be as bad as feared.
The Dow Jones Industrial Average rose 527.24 points, or 2.05%, to 26,269.89, the S&P 500 gained 42.05 points, or 1.36%, to 3,122.87 and the Nasdaq Composite added 74.54 points, or 0.78%, to 9,682.91. Economists were expecting them instead to slash another 8 million jobs amid the ongoing fallout from the response to the coronavirus pandemic.
Boeing Co gained 9.2 per cent, the biggest boost to the Dow Jones index, on hopes of a pickup in air travel a day after American Airlines Group Inc and United Airlines said they would boost their US flight schedule next month.
Shares of Western Union jumped 11.1 per cent after a report the money transfer company has made an offer to buy its smaller rival MoneyGram International Inc.
Advancing issues outnumbered declining ones on the NYSE by a 3.81-to-1 ratio; on Nasdaq, a 2.26-to-1 ratio favored advancers.
"The numbers are a huge surprise to the upside", said Michael Arone, chief investment strategist at State Street Global Advisors.
Now, the 10-year yield is close to its highest level since late March.
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Overnight, the S&P 500 lost 0.3% to 3,112.35 after being on track earlier in the day for its longest winning streak since December.
The broader All Ordinaries index (^AORD) had also posted losses of 0.37 per cent at midday. The yield on the 10-year Treasury rose to 0.71% from 0.68% late Tuesday.
"There is growing confidence the US economy can safely re-open, much as other economies such as China and Italy have successfully done", said David Carter, chief investment officer at Lenox Wealth Advisors in NY.
Bond investors will get further insight into the likely direction of the economy when the U.S. Federal Reserve holds its regular two-day policy meeting next week.
The dollar index made a tepid recovery, rising 0.08% to 96.84, but remained on track for its third consecutive week of losses and close to its lowest in almost three months.
Losers outpaced gainers 249 to 212, with 1.64 billion shares worth $2.19 billion changing hands. The European Central Bank announced that its pandemic emergency purchase programme will be increased by 600 billion euros to 1,350 billion euros, and the programme's duration will be extended until June 2021 or until it believes the coronavirus crisis is over.
Hopes for an economic recovery sent oil prices surging.
In other trading, a barrel of USA crude oil for delivery in July fell 5 cents to $37.36 per barrel in electronic trading on the New York Mercantile Exchange.