By Chuck Mikolajczak
NEW YORK (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 (NYSE:WFC) 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 (DJI) rose 102.64 points, or 0.48 percent, to 21,422.68, the S&P 500 (SPX) gained 16.69 points, or 0.69 percent, to 2,426.44 and the Nasdaq Composite (IXIC) added 69.40 points, or 1.14 percent, to 6,158.86.
The technology sector (SPLRCT), up 1.45 percent, led the charge higher, buoyed by gains of more than 1.6 percent in market cap heavyweights Apple (O:AAPL), Microsoft (O:MSFT) and Facebook (O:FB).
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 (SPSY) also advanced, up 0.68 percent.
Tesla (O:TSLA) 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.