* Nonfarm payrolls increase 211,000 in November
* OPEC to continue pumping oil at current rates
* Nine of 10 S&P sectors higher, energy weaker
* Indexes up: Dow 2.2 pct, S&P 2.2 pct, Nasdaq 2.2 pct (Updates to late afternoon)
By Sweta Singh
Dec 4 (Reuters) - U.S. stocks jumped more than 2 percent on Friday as U.S. jobs data suggested the economy was strong enough to sustain a Federal Reserve rate hike this month.
Nine of the 10 major S&P 500 sectors were higher. The energy index dipped on news that OPEC countries failed to agree on oil production limits, allowing members to continue pumping oil at current rates into a market that is oversupplied.
Financials, which benefit from higher borrowing costs, led the rally. The S&P financial index was up 2.7 percent.
JPMorgan Chase rose 2.3 percent to $67.33 after European antitrust regulators dropped charges against the bank on blocking exchanges from derivatives markets.
"Stocks are going to have to shift to a domestic economic performance focus. We're going to see the market focused on what the U.S. economy is doing, rather than Fed policy," said Brad McMillan, chief investment officer at Commonwealth Financial Network in Waltham, Massachusetts.
"I think we see a continued upward trend for the rest of the year."
Nonfarm payrolls increased 211,000 in November, the U.S. Labor Department reported, while September and October data were revised to show 35,000 more jobs than previously reported.
At 3:17 p.m. ET, the Dow Jones industrial average rose 371.07 points, or 2.12 percent, to 17,848.74, the S&P 500 gained 42.44 points, or 2.07 percent, to 2,092.06 and the Nasdaq Composite added 105.92 points, or 2.1 percent, to 5,143.45.
The U.S. unemployment rate held at a 7-1/2-year low of 5 percent, even as people returned to the labor force in a sign of confidence in the jobs market.
Fed funds futures contracts showed that traders see about an 80 percent chance that the Federal Reserve will raise interest rates in December, up from 79 percent before the jobs report.
The closely watched employment report came a day after Fed Chair Janet Yellen struck an upbeat note on the economy when she testified before lawmakers, describing how it had largely met the criteria for a rate hike. The Fed's policy-setting committee will meet on Dec. 15-16.
The S&P 500 suffered its biggest daily drop since late September on Thursday after the European Central Bank disappointed market hopes for a more aggressive economic stimulus program.
Avon Products rose 10.3 percent to $4.40 after a private equity investor group led by Barington Capital proposed a restructuring of the cosmetics maker.
Benchmark Brent oil futures and U.S. crude futures were down about 1.0 percent and energy stocks took a beating. Exxon was down 0.5 percent at $78.06, while Chevron fell 0.7 percent to $88.22.
Advancing issues outnumbered declining ones on the NYSE by 1,992 to 1,040, for a 1.92-to-1 ratio on the upside; on the Nasdaq, 1,816 issues rose and 956 fell for a 1.90-to-1 ratio favoring advancers.
The S&P 500 posted 21 new 52-week highs and 20 new lows; the Nasdaq recorded 62 new highs and 94 new lows. (Additional reporting by Sweta Singh in Bengaluru; Editing by Don Sebastian and Dan Grebler)