US STOCKS-Wall St gains as weak private jobs data raises rate cut bets

* U.S. ADP private job gains lowest since March 2010
* Bets of an interest rate cut increase
* Campbell Soup, Salesforce.com gain after forecasts
* Utilities, real estate, consumer staples gain the most
* Indexes up: Dow 0.66%, S&P 500 0.60%, Nasdaq 0.38%

(Updates to late afternoon; adds commentary, New York dateline;
changes byline)
By Sinéad Carew
NEW YORK, June 5 (Reuters) - Wall Street's major indexes
rose on Wednesday as investors bet on a Federal Reserve interest
rate cut after weak private sector jobs data and on optimism
that the United States and Mexico would reach an agreement and
avoid new U.S. tariffs on Mexican goods.
The gains extended Tuesday's rally after Fed Chairman Jerome
Powell indicated that a rate cut was possible. Other U.S.
central bank officials also hinted that they may have to react
to the U.S. trade wars, boosting rate cut hopes. The ADP National Employment Report on Wednesday further
bolstered bets for a rate cut. U.S. private employers hired at
the slowest pace in more than nine years in May, weakness that
analysts blamed on the heightening global trade tensions.
The data comes ahead of the more comprehensive nonfarm
payrolls from the Labor Department on Friday. MMT/
Investors were also encouraged after President Donald Trump
said he thinks Mexico wants to reach a deal to stop a new trade
war. A White House trade adviser and a senior U.S. Republican
senator also predicted that Washington might not introduce
proposed tariffs. A Mexico deal "would alleviate one of the risks that lurk
out there," said Mark Luschini, chief investment strategist at
Janney Montgomery Scott in Philadelphia.
In addition, he said, "You have a little spillover from
yesterday's enthusiasm around the anticipation that the Fed may
be more responsive to adjusting monetary policy."
At 2:58 p.m. ET, the Dow Jones Industrial Average .DJI
rose 167.58 points, or 0.66%, to 25,499.76, the S&P 500 .SPX
gained 16.93 points, or 0.60%, to 2,820.2, and the Nasdaq
Composite .IXIC added 28.26 points, or 0.38%, to 7,555.38.
The market was ripe for a rally, according to Luschini,
because of a more than 6% decline in the three major indexes in
May when fears of a global slowdown resurfaced due to a flare-up
in U.S.-China trade tensions.
But he was cautious about the sustainability of Wednesday's
advance because investors appeared to be favoring defensive
sectors such as utilities, real estate and consumer staples
rather than riskier sectors.
"You'd want to see materials, energy, industrials,
financials leading the rally," he said. "I'd be reluctant to
chase this rally because it might just be a snapback rebound."
Utilities .SPLRCU were up 2.4%, real estate .SPLRCR rose
1.8%, and consumer staples .SPLRCS gained 1.1%, making them
the top gainers among the S&P 500's 11 major sectors.
The technology sector .SPLRCT rose 1% and provided the
biggest boost to the market, helped by Apple Inc AAPL.O and
Microsoft Corp MSFT.O . Salesforce.com Inc CRM.N advanced
3.4% after the cloud-based service provider forecast full-year
results above expectations. The energy sector .SPNY slipped 1.3% drop, making it the
weakest of the S&P sectors, as crude prices fell sharply. O/R
Campbell Soup Co CPB.N was up 9%, making it the biggest
percentage gainer on the S&P 500, after the soup maker raised
its full-year profit forecast. Advancing issues outnumbered declining ones on the NYSE by a
1.00-to-1 ratio; on Nasdaq, a 1.50-to-1 ratio favored decliners.
The S&P 500 posted 63 new 52-week highs and seven new lows;
the Nasdaq Composite recorded 66 new highs and 94 new lows.