The Dow Jones Industrial Average broke through to its highest close since May 2008, back before the Lehman Brothers Holdings Inc. collapse, as investors increasingly put aside fears of economic calamity and focused again on fundamentals.

News of strong job growth, a three-year low in unemployment and other positive developments Friday pushed the Dow ahead 156.82 points, or 1.23%, to 12862.23, its first triple-digit gain since Jan. 3. The blue-chip index would have to rise just 10% to reach its record close of 14164.53, hit Oct. 9, 2007.

The Nasdaq Composite Index, dominated by surging technology stocks, jumped 1.61% to ...