* U.S. nonfarm payrolls post biggest gain in 10 months
* Treasury yields jump, bank shares rise
* Ulta Beauty jumps on quarterly profit beat
* Indexes up: Dow 1.2%, S&P 500 0.99%, Nasdaq 1.03% (Updates to late afternoon, adds dateline, changes byline)
NEW YORK, Dec 6 (Reuters) - Wall Street advanced on Friday as a robust jobs report and a note of optimism regarding ongoing U.S.-China trade negotiations enticed buyers to the equities market.
All three major U.S. stock indexes were firmly in the black, inching within 1% of record highs set last week.
But as a tumultuous week of contradictory trade news and mixed economic data drew to a close, only the S&P 500 appeared poised for a weekly gain. The Dow and the Nasdaq looked set to post declines from last Friday's close.
The U.S. economy added 266,000 jobs in November, the biggest increase in 10 months according to the Labor Department, blowing past analyst estimates. The unemployment rate pulled back to 3.5%.
On the trade front, White House economic adviser Larry Kudlow remarked that while the Dec. 15 deadline is still in place for the next round of tariffs on Chinese goods to take effect, "the reality is constructive talks, almost daily talks, we are, in fact, close."
"(The jobs report) certainly contributes to the idea that the U.S. economy is doing better than most folks would give it credit for," said Michael Arone, chief investment strategist at State Street Global Advisors in Boston. "This should continue to help the U.S. consumer in terms of their contribution to economic growth, not only now but next year as well."
U.S. Treasury yields rose after the strong employment report, and bank stocks were on track for their best day in over a month, rising 1.9%.
The Dow Jones Industrial Average rose 331.23 points, or 1.2%, to 28,009.02, the S&P 500 gained 30.92 points, or 0.99%, to 3,148.35 and the Nasdaq Composite added 88.27 points, or 1.03%, to 8,658.97.
Of the 11 major sectors of the S&P 500, all but utilities were trading in positive territory, with energy , financials and trade-sensitive industrials enjoying the largest percentage gains.
Energy stocks were lifted by a 1.3% rise in crude prices following an agreement between OPEC and its allies to extend output cuts through 2020.
Tariff-vulnerable chip stocks were buoyed by Kudlow's comments. The Philadelphia Semiconductor index gained 1.7%.
Shares of cosmetics retailer Ulta Beauty Inc jumped 13.1%, the best performer in the S&P 500, after beating quarterly profit expectations.
Tesla Inc rose 1.9% after revealing it would receive state subsidies for its Chinese-built Model 3 cars.
3M Co advanced 3.9% after Bloomberg reported the company was exploring a sale of its drug delivery systems business which could fetch about $1 billion.
Advancing issues outnumbered declining ones on the NYSE by a 2.99-to-1 ratio; on Nasdaq, a 2.74-to-1 ratio favored advancers.