US STOCKS-Wall St up ahead of holiday; data lifts payroll hopes

(Updates to midday trading)

* Investors look to payrolls data due on Good Friday

* All ten S&P 500 sectors higher in broad rally

* Micron up despite outlook; CarMax (NYSE: KMX - news) rallies on results

* Indexes up: Dow 0.3 pct, S&P 0.4 pct, Nasdaq 0.2 pct

By Ryan Vlastelica

NEW YORK, April 2 (Reuters) - U.S. stocks rose in a broad advance on Thursday as a reading on the labor market came in better than expected, raising hopes that Friday's payroll report would show similar strength.

Jobless claims unexpectedly fell in the latest week, suggesting the labor market continues to expand at a solid clip even as economic growth has stalled. The report follows lower-than-expected readings on private sector employment and manufacturing on Wednesday.

Investors were looking ahead to the March jobs report, which will be released Friday, a stock market holiday for Good Friday. As a result, market participants will be unable to trade off the report until Monday.

"People are looking ahead to the jobs report and right now it would be a surprise if it was weaker than expected," said John Carey, portfolio manager at Pioneer Investment Management in Boston, though he said playing it ahead of time could be tricky.

"If the report is weaker than expected, people might become more optimistic about interest rates," he said. "Bad news could be good news."

The Federal Reserve has said it won't raise interest rates until it deems the economy strong enough to withstand such a move, which will raise borrowing costs and possibly crimp spending. A below-consensus jobs number on Friday could ease concerns of a nearer-term rate rise, Carey said.

The release of the jobs report has only coincided with Good Friday four times since 1999, according to data from Bespoke, most recently in 2012. Analysts expect 245,000 jobs to have been added in the month, down from 295,000 in February.

The day's gains were broad, with all 10 primary S&P 500 sectors advancing.

Energy rose 0.2 percent despite a drop of 2.6 percent in U.S. crude futures. The commodity fell as nuclear talks between officials from the big global powers and Iran continued. If the talks are successful, that could allow Iran to release more crude oil onto world markets at a time when concerns about oversupply have already contributed to the commodity being down more than 50 percent since June.

CarMax Inc jumped 9.8 percent to $75.06 as the S&P 500's biggest percentage gainer after it reported fourth-quarter results that topped expectations.

Micron Technology Inc (NasdaqGS: MU - news) late Wednesday forecast lower revenue for the current quarter. Still, shares rose 0.6 percent to $27.30.

The Dow Jones industrial average rose 59.46 points, or 0.34 percent, to 17,757.64, the S&P 500 gained 8.09 points, or 0.39 percent, to 2,067.78 and the Nasdaq Composite added 9.66 points, or 0.2 percent, to 4,889.89.

Advancing issues outnumbered declining ones on the NYSE by 2,006 to 883, for a 2.27-to-1 ratio on the upside; on the Nasdaq, 1,607 issues rose and 959 fell for a 1.68-to-1 ratio favoring advancers.

The benchmark S&P 500 index was posting 16 new 52-week highs and 1 new lows; the Nasdaq Composite was recording 77 new highs and 24 new lows. (Editing by Bernadette Baum)