* January payrolls disappoint, December revised up slightly
* Apple leads market higher on buyback boost
* Online travel agencies' shares jump after Expedia results
* Spot VIX falls to trade below VIX futures
* Dow up 0.7 pct, S&P 500 up 0.9 pct, Nasdaq up 1.3 pct
By Rodrigo Campos
NEW YORK, Feb 7 (Reuters) - U.S. stocks climbed on Friday, setting the S&P 500 on track for its first weekly gain in four as a weak reading on the labor market was partly blamed on the weather and traders focused on expectations of further economic strength.
Nonfarm payrolls added 113,000 jobs in January. Economists had forecast a gain of 185,000. December payrolls were revised upward by only 1,000 to 75,000. The U.S. unemployment rate in January hit a five-year low of 6.6 percent. That rate is just above the 6.5 percent level that Fed officials have said would prompt them to consider raising benchmark interest rates from near zero.
Strong job gains in construction hinted that cold weather was probably not a major factor in January job creation. Traders appeared to expect that the January numbers will be revised upward next month. The data also showed job gains in manufacturing.
"Investors are giving the report the benefit of the doubt because of the weather situation," said Donald Selkin, chief market strategist at National Securities in New York, which has about $3 billion in assets under management.
"What's interesting is that stocks (futures) initially got killed after the report came out, but now we're pretty sharply higher. That's a strong sign that we've bottomed out."
Concern about recent soft U.S. data added to worries about growth in China and a selloff in emerging market currencies and equities to push stocks sharply lower worldwide in the past few weeks.
Near-term concerns have subsided, however, and the spot price for protection against drops in the S&P 500 is again below front-month contracts, following a brief inversion of that curve. The CBOE Volatility Index fell to 15.50 after trading above 21 earlier this week. One-month VIX futures ticked lower to 15.73.
As investors await a batch of fresh data in the coming month, previous expectations for sustained U.S. economic growth are still supporting stock prices.
"There's a favorable backdrop for further economic growth," said Terry Sandven, chief equity strategist at U.S. Bank Wealth Management in Minneapolis.
"Near-term direction is likely to be set by technicals rather than fundamentals," he said.
The S&P 500 hit a session high just shy of its 14-day moving average. It hasn't traded above it since Jan. 23.
The Dow Jones industrial average rose 105.12 points or 0.67 percent, to 15,733.65. The S&P 500 gained 15.05 points or 0.85 percent, to 1,788.48. The Nasdaq Composite added 50.889 points or 1.25 percent, to 4,108.011.
The S&P 500 fell as much as 6 percent this week from a record closing high set on Jan. 15. Before Friday's gains, the benchmark index was facing its fourth weekly decline in a row - a losing streak not seen since July and August in 2011.
The tech sector got a lift from Apple Inc after the iPhone maker said it bought $12 billion worth of stock via an accelerated buyback program and $2 billion more from the open market in the two weeks since it reported earnings. Apple's stock shot up 1.9 percent to $522.22.
News Corp Class A shares jumped 7.7 percent to $17.25 a day after the publisher of the Wall Street Journal said cost cuts helped push its profit well above analysts' forecasts.
Shares of online travel agency Expedia surged 11.3 percent to $72.50 a day after the company posted a higher-than-expected quarterly profit. Shares of rival Priceline.com added 3.5 percent to $1,178.42, while Orbitz Worldwide gained 4.5 percent to $7.45 and TripAdvisor climbed 10.1 percent to $84.93.
Thomson Reuters data showed that of the 343 companies in the S&P 500 that had reported earnings through Friday morning, 67.9 percent have topped Wall Street's expectations, slightly above the 67 percent beat rate for the past four quarters and ahead of the 63 percent rate since 1994.
Breaking away from the session's upward trend, shares of LinkedIn fell 6.8 percent to $208.36 after the online network for professionals gave revenue forecasts that were below those of analysts.
Shares of Fairway Group Holdings Corp tumbled 28.9 percent to $8.13 a day after the upscale grocery store chain posted quarterly results and announced changes in management.