CORRECTED-US STOCKS-Wall Street flat after jobs data, China stimulus plan

(Corrects first bullet to say "130,000 jobs", not "130,0000
jobs")
* U.S. economy adds 130,000 jobs in August
* Average hourly earnings gained 0.4%
* Indexes up: Dow 0.30%, S&P 0.24%, Nasdaq 0.21%

By Uday Sampath Kumar
Sept 6 (Reuters) - U.S. stocks treaded water on Friday as
underwhelming jobs data rounded off a week of mixed economic
signals about the domestic economy, while a new stimulus plan
from China helped ease some concerns around global growth.
Global markets inched higher after China's central bank said
it would slash the amount of cash that banks must hold as
reserves, releasing a total of 900 billion yuan ($126.35
billion) in liquidity. Slower-than-expected payroll growth in August hinted at a
slowing U.S. economy, helping cement expectations of an interest
rate cut by the Federal Reserve later this month.
The Labor Department's nonfarm payroll data showed that the
economy added 130,000 jobs in August, below expectations of a
gain of 158,000, according to a Reuters survey of economists. average hourly earnings gained 0.4% last month, the
largest increase since February, raising hopes that healthy
consumer spending could put inflation on track to meet the Fed's
target.
"It was generally a weak report. The U.S. labor market has
been the last line of defense amid softening global economic
data," said Bill Merz, head of fixed income research at U.S.
Bank Wealth Management in Minneapolis.
"We can't read too much into any single report, but this is
one more piece of evidence that the Fed is behind the curve."
Market participants will keep a close watch on Fed Chairman
Jerome Powell's speech at the University of Zurich later on
Friday for clues on monetary policy. They currently expect a
quarter percentage point cut at the Fed's mid-September meeting.
Although U.S. markets kicked off the week on the back foot
on poor August factory data, they were on track to end higher
after being boosted by diffusing political tensions in Hong Kong
and hopes of a de-escalation in U.S.-China trade tensions.
Strong growth in August private payrolls and an accelerating
services sector also helped boost stocks to one-month highs
later in the week. The benchmark S&P 500 .SPX rose 1.3% on
Thursday and is now just 1.5% shy of its record high from July.
The communication services sector .SPLRCL was the biggest
drag among the 11 major S&P sectors, pulled lower by Facebook
Inc FB.O , which fell 1.7% after several U.S. state attorneys
general said they would investigate the social media giant on
whether it stifled competition and put users at risk.

A drop in oil prices also pressured energy stocks .SPNY ,
which fell 0.25%, leading losses on the S&P.
At 10:54 a.m. ET the Dow Jones Industrial Average .DJI was
up 80.04 points, or 0.30%, at 26,808.19, the S&P 500 .SPX was
up 7.22 points, or 0.24%, at 2,983.22 and the Nasdaq Composite
.IXIC was up 16.94 points, or 0.21%, at 8,133.77.
Among stocks, Marathon Oil MRO.N was down about 2% after
Goldman Sachs cut its price target on the stock.
Advancing issues outnumbered decliners by a 1.96-to-1 ratio
on the NYSE and a 1.76-to-1 ratio on the Nasdaq.
The S&P index recorded 42 new 52-week highs and no new lows,
while the Nasdaq recorded 42 new highs and 25 new lows.