US STOCKS-U.S. jobs data lifts Wall Street as tech, financials advance

* June nonfarm payrolls up by 222,000 vs. est. 179,000

* Unemployment rate edges up to 4.4 pct from 4.3 pct in May

* Average hourly earnings rise 0.2 pct vs est 0.3 pct

* Dow up 0.48 pct, S&P 500 up 0.69 pct, Nasdaq up 1.14 pct
(Updates to mid-afternoon, changes byline)

By Chuck Mikolajczak

NEW YORK, July 7 (Reuters) – Wall Street stocks climbed on
Friday, with the S&P 500 index on track for its best gain in six
sessions on the heels of a strong U.S. payrolls report, led by
gains in technology stocks.

Nonfarm payrolls increased by 222,000 jobs last month, data
from the Labor Department showed, topping economists’
expectations for a 179,000 gain.

Average hourly earnings rose 0.2 percent in June after
gaining 0.1 percent in May, but fell short of the estimated 0.3
percent increase.

While the unemployment rate ticked up to 4.4 percent from a
16-year low of 4.3 percent, that was because more people were
looking for work, a sign of confidence in the labor market.

The jobs report relieved investors who have paid close
attention to wage growth and whether inflation will climb enough
to justify the Federal Reserve’s plan to raise interest rates
once more this year.

“There is certainly no reason given the data we saw this
morning to knock the Fed off the track of probably one more
raise this year and maybe an announcement in September about
reducing the bond purchase,” said Sean Lynch, co-head of global
equity strategy at Wells Fargo Investment Institute in Omaha,
Nebraska.

Perceived chances of a rate hike at the Fed’s December
meeting stood at 51.5 percent, according to Thomson Reuters
data.

Policymakers have taken opposing views on inflation after it
retreated further below the U.S. central bank’s 2 percent target
in May, creating uncertainty over the future path of rate hikes.

The Dow Jones Industrial Average rose 102.64 points,
or 0.48 percent, to 21,422.68, the S&P 500 gained 16.69
points, or 0.69 percent, to 2,426.44 and the Nasdaq Composite
added 69.40 points, or 1.14 percent, to 6,158.86.

The technology sector, up 1.45 percent, led the
charge higher, buoyed by gains of more than 1.6 percent in
market cap heavyweights Apple, Microsoft and
Facebook.

Despite slumping nearly 3 percent last week, the tech sector
is up more than 17 percent on the year, tops among the 11 major
S&P groups.

“They had a pretty good quarter of earnings last quarter and
investors might be positioning themselves ahead of the next
quarter of reporting and guidance that we see from some of the
big tech companies,” said Lynch.

“That weakness that we saw the past couple of weeks has
given people an opportunity to jump back into some of these
names.”

With the Fed now expected to remain on track for a rate hike
later this year, financials also advanced, up 0.68
percent.

Tesla rose 1 percent after the luxury electric
carmaker said about 3,500 vehicles were in transit to customers
at the end of the second quarter and they would be counted as
deliveries in the third quarter.

Advancing issues outnumbered declining ones on the NYSE by a
2.14-to-1 ratio; on Nasdaq, a 2.26-to-1 ratio favored advancers.
(Reporting by Chuck Mikolajczak; Editing by James Dalgleish)


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