Indexes up: Dow 0.60%, S&P 1.02%, Nasdaq 1.66%
Nike drops after warning on China demand weakness
Moderna rises after Nasdaq-100 index inclusion news

(Updates after market open)

By Johann M Cherian and Tharuniyaa Lakshmi

Oct 2 (Reuters) - US stocks rose on Friday, pushing the Nasdaq Composite to a record high, after weaker-than-expected jobs data reduced odds of a near-term rate hike, driving Treasury yields lower, while lower oil prices added to the risk-on mood.

Semiconductor stocks and megacaps led the gains. Nvidia (NVDA.O) touched intraday record high, up 2.5%, while the Philadelphia chip index (.SOX) firmed 3.1%. Among other heavyweights, Musk-led SpaceX (SPCX.O) added 5.5%, Tesla (TSLA.O) gained 4.1%, while Oracle (ORCL.N) rose 3%.

Nonfarm payrolls increased by 29,000 jobs last month and the numbers of the prior two months were revised sharply lower, the Labor Department’s closely watched employment report showed on Friday. Economists polled by Reuters had forecast payrolls advancing 90,000.

“The lower jobs print, including the revision, is, oddly enough, good news for stocks. With the bond market organically doing the job of the Fed recently, we needed to sacrifice a headline metric and this morning’s report accomplished the goal,” said Todd Schoenberger, chief investment officer at CrossCheck Management.

A string of data showing resilient economic activity and a slower-than-expected increase in prices, along with comments from at least two top policymakers pushing back against another rate increase, have led investors to increasingly bet that the central bank will keep rates on hold this month.

Traders now assign a 20% probability that the Federal Reserve would hike rates by 25 basis points in October, compared with 26% before the report.

The yield on the two-year Treasury note (US2YT=RR) , which is closely tied to interest-rate expectations, retreated for the second straight day.

Adding to the positive sentiment, Brent crude prices (LCOc1) slipped below $100 a barrel after a report that the European Union discussed additional diesel and crude stock releases, even though there were no new updates on the resolution to the Middle East conflict.

The Cboe Volatility Index (.VIX) , Wall Street’s fear gauge, fell to a one-week low and was last down at 15.67 points.

At 10:14 a.m. ET, the Dow Jones Industrial Average (.DJI) rose 306.78 points, or 0.60%, to 51,233.34, the S&P 500 (.SPX) gained 78.31 points, or 1.02%, to 7,744.76 and the Nasdaq Composite (.IXIC) gained 447.84 points, or 1.66%, to 27,319.43.

Ten out of 11 major sectors on the S&P 500 were trading higher, with consumer discretionary (.SPLRCD) and the technology index (.SPLRCT) leading the gains and the healthcare index (.SPXHC) being the only laggard.

Nike (NKE.N) fell 5.6% after the US sportswear company forecast a surprise steep drop in annual revenue due to weakness in China, announced job cuts and decided to shake up its global business divisions.

Friday will also bring August data on factory orders along with comments by Dallas Fed President Lorie Logan.

Among other equities, credit-scoring company Fair Isaac (FICO.N) fell 1.5% after Bloomberg News reported that the US Federal Housing Finance Agency plans to ease mortgage credit data requirements for Fannie Mae (FNMA.PK) and Freddie Mac (FMCC.PK) .

Reflecting the broader risk-on sentiment, bitcoin (BTC=) gained 3.4%, while Coinbase (COIN.O) and Strategy (MSTR.O) rose nearly 3.1% each.

Advancing issues outnumbered decliners by a 3.27-to-1 ratio on the NYSE, and by a 2.5-to-1 ratio on the Nasdaq.

The S&P 500 posted nine new 52-week highs and 14 new lows, while the Nasdaq Composite recorded 35 new highs and 100 new lows.