* Payrolls data weaker than expected
* Gap shares fall on weak August same-store sales
* Prana Biotech jumps on orphan drug designation
* Dow up 0.06 pct, S&P up 0.05 pct, Nasdaq off 0.07 pct (Updates to midday)
By Chuck Mikolajczak
NEW YORK, Sept 5 (Reuters) - U.S. stocks were little changed Friday as a weak payrolls report encouraged investors that the Federal Reserve wouldn't accelerate plans to hike interest rates, though the S&P 500 remained on track for its first weekly decline in five.
After a recent flurry of economic data pointed to a strengthening economy, nonfarm payrolls for August were well below expectations, throwing cold water on the possibility that the Fed might speed up plans to hike interests at its next meeting in mid-September.
"One of the big fears of this market, maybe the only fear, has been rapidly rising interest rates," said Rick Meckler, president at LibertyView Capital Management in Jersey City, New Jersey.
"This puts an end to those thoughts in the near term. For a stock market investor, an economy that's not too hot, not too cold, is perfect."
The benchmark index has fallen for three straight sessions since closing at a record high of 2,003.37 a week ago. The S&P 500 appeared to hold its 14-day moving average on Friday, seen as a technical support level.
The Dow Jones industrial average rose 9.63 points, or 0.06 percent, to 17,079.21, the S&P 500 gained 0.94 points, or 0.05 percent, to 1,998.59 and the Nasdaq Composite dropped 3.42 points, or 0.07 percent, to 4,558.87.
Michael Kors shares lost 4.3 percent to $76.54 as the worst performer on the S&P 500. The company announced an 11.6 million share secondary offering on behalf of one of its founding shareholders, which will result in the resignation of two board members.
Retailers lost ground, weighed by a 4.7 percent drop in Gap Inc to $44.41, after the company posted worse-than-expected August same-store-sales. The S&P retail index shed 0.4 percent.
U.S.-listed shares of Prana Biotechnology surged 21.5 percent to $2.60 fter the company said it received an orphan drug designation for its Huntington Disease treatment. (Additional reporting by Herbert Lash; Editing by Bernadette Baum)