U.S. stocks closed at record highs Thursday to end a holiday shortened week, with the Dow Jones Industrial Average settling above 17,000 points for the first time, boosted by stronger-than-expected U.S. nonfarm payroll report.

The Dow jumped 92.02 points, or 0.54 percent, to 17,068.26, a new record closing high. The S&P 500 also refreshed its record close, adding 10.82 points, or 0.55 percent, to end at 1,985.44. The Nasdaq Composite Index rose 28.19 points, or 0.63 percent, to 4,485.92.

The Dow pierced through the psychologically important level of 17,000 points for the first time immediately after the opening bell, while both the blue-chip index and the broader S&P 500 kept renewing their all-time intraday highs during the morning session. The Dow and the S&P 500 set all-time intraday highs of 17,074.65 points and 1,985.59 points respectively, eclipsing those set on July 1.

On the economic front, U.S. nonfarm payroll employment increased by 288,000 in June, said the Labor Department Thursday. The fresh data was much higher than economists' expectations.

Meanwhile, unemployment rate declined unexpectedly from 6.3 percent to 6.1 percent in June, the department added.

The jobs gain in June reflected that "the labor market remains surprisingly and resiliently strong," said the Conference Board, a private research group based in New York, in a note Thursday. " This is not just catch up after a bad winter. It also reflects some gathering strength in the economy," it added.

Due to the fast improving labor market and firming inflation, J. P. Morgan economists are pulling forward their projection for the Federal Reserve's tightening.

Michael Feroli, chief U.S. economist at J.P. Morgan, said Thursday that they now see a lift-off of the federal funds rate occurring in the third quarter of 2015 rather than the fourth quarter of 2015 and expect the funds rate at 1.0 percent for yearend 2015 and 2.5 percent for 2016.

The Labor Department also reported that the number of Americans who initially applied for jobless benefits slightly rose 2,000 to a seasonally adjusted 315,000 in the week ending June 28, in line with market forecast.

Among other data, U.S. trade deficit narrowed in May to 44.4 billion dollars, down from a two-year high of 47 billion dollars in April, as exports increased and imports dipped, the Commerce Department said.

Wall Street was little affected by a report from the Institute for Supply Management which showed economic activity in the U.S. non-manufacturing sector expanded at a slightly slower pace in June, with the non-manufacturing index at 56 percent in June from 56.3 percent in May, trailing market consensus.

Moreover, the final Markit U.S. Services purchasing managers' index registered 61.0 in June, up from 58.1 in May, said financial data firm Markit.

The CBOE Volatility Index, often referred to as Wall Street's fear gauge, continued to fall Thursday, down 4.62 percent to end at 10.32.

There were only four trading days this week as U.S. financial markets are closed Friday for the Independence Day holiday.

For the week, the Dow rose 1.3 percent, the S&P 500 added 1.2 percent and the Nasdaq rose 2.0 percent.

Looking ahead, investors expect to see U.S. companies publish second-quarter earnings next week, with aluminum giant Alcoa's quarterly results due next Tuesday to kick off the new earnings season.

In other markets, the dollar jumped against most major currencies Thursday. In late New York trading, the euro fell to 1. 3609 dollars from 1.3656 dollars in the previous session. The dollar bought 102.20 Japanese yen, higher than 101.83 yen of the previous session.

Crude prices continued to drop as market expected more crude supplies from Libya. Light, sweet crude for August delivery moved down 42 cents to settle at 104.06 dollars a barrel on the New York Mercantile Exchange.

Gold futures on the COMEX division of the New York Mercantile Exchange lost ground Thursday on a stronger-than-expected U.S. jobs report. The most active gold contract for August delivery fell 10.3 dollars, or 0.77 percent, to settle at 1,320.6 dollars per ounce.