* Oil prices edge towards $50/barrel
* Alibaba falls after SEC launches investigation
* Computer Sciences jumps after Hewlett Packard Enterprise deal
* Indexes rise: Dow 0.86 pct, S&P 0.68 pct, Nasdaq 0.58 pct (Updates to afternoon)
By Noel Randewich
May 25 (Reuters) - Wall Street rose robustly for a second straight session on Wednesday, helped by higher oil prices and investors becoming more comfortable with the prospect of an interest rate hike as early as next month.
The energy sector led the way, up 1.4 percent as oil prices rose toward $50 a barrel following a report of a larger-than-expected drop in U.S. crude inventories, adding to expectations that a steep selloff in the commodity may be over.
The S&P financial index rose 1.08 percent and was near its highest this year. Bank of America, JPMorgan and Citigroup were up over 1.5 percent.
Comments from policymakers in recent days and upbeat U.S. economic data have raised expectations that the Federal Reserve could pull the trigger on a rate increase much sooner than previously thought.
Traders are now pricing in a 38-percent chance for a rate hike in June and 45 percent in July, according to CME Group's FedWatch tool.
"What you're seeing is a recognition that this is going to happen and investors are getting more comfortable with it," said Kurt Brunner, a portfolio manager at Swarthmore Group in Philadelphia. "There's a recognition that economic growth is okay."
At 2:09 pm, the Dow Jones industrial average was up 0.86 percent at 17,858.97 points and the S&P 500 had gained 0.68 percent to 2,090.21.
The Nasdaq Composite added 0.58 percent to 4,889.43.
Gains were broad-based, with nine of the 10 major S&P sectors trading higher.
The S&P 500 has risen about 15 percent from its February lows and is up about 2 percent for the year.
Shares of Computer Sciences soared 39 percent after Hewlett Packard Enterprise said it would spin off and merge its struggling IT services business with the company. Hewlett Packard Enterprise jumped 6.21 percent.
Alibaba Group tumbled 8.4 percent after saying it was being investigated by the U.S. Securities and Exchange Commission over whether its accounting practices violated any federal laws.
Advancing issues outnumbered decliners on the NYSE by 2,005 to 982. On the Nasdaq, 1,775 issues rose and 1,017 fell.
The S&P 500 index showed 34 new 52-week highs and no new lows, while the Nasdaq recorded 88 new highs and 18 new lows. (Additional reporting by Tanya Agrawal; Editing by Nick Zieminski)