(Updates with preliminary closing prices at 4:00 p.m ET/ 2100

GMT)

By Sinéad Carew and Bansari Mayur Kamdar

March 6 (Reuters) - Wall Street's three major indexes

closed higher on Wednesday as economic data and comments from

Federal Reserve Chair Jerome Powell reinforced expectations that

the U.S. central bank would reduce its benchmark interest rate

this year.

Powell said on Wednesday that he still expected the Fed to

cut rates and that the U.S. economy appeared nowhere near a

recession although he shied away from committing to a timetable

for rate cuts as progress on inflation was not assured.

In prepared remarks ahead of his congressional testimony,

Powell said inflation had "eased substantially" since hitting

40-year highs in 2022, but that policymakers still needed

"greater confidence" in its decline before rate cuts.

"He was clear that the Fed does see rate cuts coming this

year. That's what the markets needed to hear. Was it couched in

some ambiguous terms? Yes, but overall the message was clear,"

said Quincy Krosby, chief global strategist for LPL Financial.

"It's not if but when the Fed initiates a rate easing policy."

Along with Powell's testimony, Mark Luschini, chief

investment strategist at Janney Montgomery Scott in

Philadelphia, said Wednesday's economic data also boosted hopes

for rate cuts as well as confidence in the labor market.

Data showed U.S. private payrolls increased slightly less

than expected in February.

And the Job Openings and Labor Turnover Survey (JOLTS)

showed job openings fell marginally in January, while hiring

declined as labor market conditions continued to gradually ease.

"The number of job openings shriveled a bit, but are still

quite healthy and indicative of a labor market that is still

looking pretty stout," said Luschini. "It fits the Goldilocks

narrative that's become consensus."

February's nonfarm payrolls report due on Friday is expected

to offer further clarity on the state of the labor market.

Unofficially, the Dow Jones Industrial Average rose

76.32 points, or 0.2%, to 38,661.51, the S&P 500 gained

26.14 points, or 0.51%, to 5,104.79 and the Nasdaq Composite

added 91.96 points, or 0.58%, to 16,031.54.

Wall Street indexes had lost more than 1% on Tuesday with

weakness in megacap stocks and as investors anxiously awaited

Powell's comments.

Chip companies outperformed the broader market after

underperforming on Tuesday, with the Philadelphia semiconductor

index rallying.

Tesla extended losses for the third straight

session. Baird said the electric vehicle maker's first-quarter

earnings were at risk, suggesting delivery estimates still need

to go lower.

U.S.-listed shares of China's JD.com ( JD ) advanced after

the e-commerce group reported fourth-quarter revenue above

estimates and enlarged its share repurchase program.

Shares of cryptocurrency-linked companies including Coinbase

Global ( COIN ) and MicroStrategy ( MSTR ) also gained.

CrowdStrike Holdings ( CRWD ) shares soared after the

company forecast annual results above Wall Street estimates,

lifted by strong enterprise spending on cybersecurity to counter

rising online threats. However, rival Palo Alto fell.