* 255,000 jobs added in July vs est. 180,000
* Unemployment rate unchanged at 4.9 pct
* Bristol-Myers drops after drug fails trial, rival Merck soars
* Indexes up: Dow 0.74 pct, S&P 0.54 pct, Nasdaq 0.68 pct (Adds details, comments, updates prices)
By Yashaswini Swamynathan
Aug 5 (Reuters) - Wall Street opened higher on Friday as robust labor market data boosted optimism about the strength of the U.S. economy.
The report by the U.S. Labor Department showed that nonfarm payrolls rose by 255,000 in July. Economists had expected a rise of 180,000.
The report also showed that the unemployment rate was flat at 4.9 percent, staying below the 5 percent mark associated with full employment. Average hourly wages rose by 8 cents.
"(The data) cements the view that the economy is improving despite the recent negative news from GDP," said Aaron Kohli, interest rate strategist at BMO Capital Markets in New York.
The data suggests that the April and May jobs data was an aberration and that June was more consistent with what is going on in the economy, he said. The June employment number was revised up to 292,000 from 287,000.
However, inflation running below the Fed's 2 percent target and weaker-than-expected GDP growth amid global uncertainty could deter the central bank from pulling the trigger in the near term.
The chances of a rate hike doubled to 18 percent in September after the jobs report, and rose to 36.8 percent from 29.4 percent in December. Those numbers do not rise significantly even until July next year, according to CME Group's FedWatch tool.
"I'm not sure this is enough to move the needle in either direction for the Fed," said Curt Long, chief economist at National Association Of Federal Credit Unions in Washington.
At 9:42 a.m. ET (1342 GMT), the Dow Jones Industrial Average was up 135.31 points, or 0.74 percent, at 18,487.36.
The S&P 500 was up 11.67 points, or 0.54 percent, at 2,175.92.
The Nasdaq Composite was up 34.94 points, or 0.68 percent, at 5,201.18.
Seven of the 10 major S&P 500 sectors were higher, led by a 0.89 percent rise in financials.
Shares of banks including JPMorgan, Bank of America and Citigroup, which stand to gain if the Fed raises rates, rose between 2 percent and 3 percent.
Bristol-Myers plunged 16.3 percent after its lung cancer drug failed in a late-stage study, while Merck, which makes a rival drug, soared 6 percent.
Bristol-Myers was the biggest drag on the S&P, while Merck gave the index its biggest boost.
Advancing issues outnumbered decliners on the New York Stock Exchange by 1,902 to 752. On the Nasdaq, 1,594 issues rose and 694 fell.
The S&P 500 index showed 16 new 52-week highs and no new lows, while the Nasdaq recorded 49 new highs and eight new lows. (Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Anil D'Silva)