* 179,000 private sector jobs added in July vs est. 170,000
* AIG rises on profit beat
* Kate Spade falls after cutting forecast
* Indexes up: Dow 0.14 pct, S&P 0.1 pct, Nasdaq 0.1 pct (Adds details, comments, updates prices)
By Yashaswini Swamynathan
Aug 3 (Reuters) - Wall Street was higher in choppy trading on Wednesday as strong jobs data helped financial stocks, while a recovery in oil prices boosted energy shares.
Data showed the U.S. private sector added 179,000 jobs in July, beating estimates of 170,000. The ADP national employment report is seen as a precursor to the more comprehensive jobs data on Friday.
If the labor market is able to build on its recent strength, it could make the case for the Federal Reserve to raise interest rates later this year.
"I think any kind of strength in the overall economy does help the financials because it increases the prospects of the Fed being able to raise interest rates," said Robert Pavlik, chief market strategist at Boston Private Wealth in New York.
Oil prices jumped about 2 percent on Wednesday, with U.S. crude futures returning above $40 a barrel, after the U.S. government reported a larger-than-expected gasoline drawdown that offset a surprise build in crude stockpiles.
"You are still seeing some pressure on energy stocks, but I think for the most part, its not completely scaring everybody out of the energy space," Pavlik said.
Five of the 10 major S&P sectors were higher, led by 0.7 percent gains in both financials and energy stocks.
Shares of JPMorgan, Citigroup, Wells Fargo and Bank of America rose between 0.4 percent and 2 percent.
Goldman Sachs was up 1.6 percent at $158.55, giving the biggest boost to the Dow.
Oil major Chevron rose 0.5 percent and EOG Resources 2 percent.
At 10:56 a.m. ET the Dow Jones Industrial Average was up 25.85 points, or 0.14 percent, at 18,339.62.
The S&P 500 index was up 2.11 points, or 0.1 percent, at 2,159.14.
The Nasdaq Composite was up 5.20 points, or 0.1 percent, at 5,142.94.
AIG jumped 7 percent to $57.92 after the insurer's second-quarter profit beat analysts' estimates. The stock was the second-biggest influence on the S&P.
Kate Spade shares plunged 20.5 percent after the handbag maker slashed its full-year profit and sales forecast and reported a lower-than-expected quarterly profit.
Tesla and Twenty-First Century Fox are scheduled to report after the bell.
Advancing issues outnumbered decliners on the NYSE by 1,603 to 1,227. On the Nasdaq, 1,443 issues rose and 1,150 fell.
The S&P 500 index showed eight new 52-week highs and one new low, while the Nasdaq recorded 44 new highs and 27 new lows. (Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Anil D'Silva)