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US STOCKS-Wall St rallies; S&P 500 close to break-even for week

* Markets in broad rally on hopes for China stimulus

* Momentum stocks still in focus; Netflix edges lower

* Dow up 0.6 pct; S&P 500 up 0.7 pct; Nasdaq up 0.7 pct

(Updates to midday)

NEW YORK, March 28 (Reuters) - U.S. stocks rose on Friday, with all 10 major S&P 500 sectors gaining in a broad rally after two days of losses, on comments from a Chinese official indicating that the country's government was ready to take steps to support its slowing economy.

With the day's advance, the Dow turned positive for the week. The S&P 500 sharply cut its weekly losses and came within 5.12 points of being flat for the week.

The Nasdaq, however, remained on track for a negative week following an extended period of investors taking profits in some of the market's biggest outperformers.

"We are seeing a good rebound today, but there are still a lot of factors that indicate we could be going into a more sizable correction," said Randy Frederick, managing director of trading and derivatives at the Schwab Center for Financial Research in Austin, Texas.

"Almost everyday this week, we've been seeing a pattern of the market opening higher and then selling off towards the close. Some are saying that it's the smart money is selling off at the end of the day. If we see that pattern again today, that would be concerning."

The Dow Jones industrial average rose 97.78 points or 0.60 percent, to 16,362.01. The S&P 500 gained 12.36 points or 0.67 percent, to 1,861.40. The Nasdaq Composite added 27.50 points or 0.66 percent, to 4,178.732.

For the week, the Dow was up 0.4 percent, while the S&P 500 was down 0.3 percent and the Nasdaq was down 2.3 percent.

China's Premier Li Keqiang said the government had the necessary accommodative policies in place and would push ahead with infrastructure investment.

"We cannot neglect the increasing downward pressure and difficulties," Li said in a speech on Wednesday, reported by the Xinhua news agency early on Friday.

The prospect of slowing growth in China, the world's second-largest economy, has long been a market headwind. Recent data has pointed to the weakest growth there since the global financial crisis, raising hopes that Beijing would step in with support for the economy.

"This could avert a slowdown in China, and any stimulus that helps growth somewhere should help growth globally," said Jack Ablin, chief investment officer of BMO Private Bank in Chicago.

In the latest economic data, personal income and consumption both rose 0.3 percent in February, the latest indication that weak data earlier this year was due to bad weather rather than worsening fundamentals.

Red Hat Inc reported fourth-quarter earnings that beat expectations late Thursday, though the company gave a full-year profit view that was below forecasts. Red Hat's stock fell 4.9 percent to $53.36.

The week's losses were concentrated in the Nasdaq as investors took profit in some of the market's biggest outperformers, primarily in the Internet and biotech space. Some analysts say the selloff in "momentum" stocks has yet to run its course, though this could benefit more value-orientated names. A move to such companies helped limit the Dow's weekly decline.

One of the more prominent momentum names, Netflix Inc , continued its downward trend, slipping 0.4 percent to $362.87. If the online movie rental company's stock closes lower on Friday, it will have dropped for 16 of the last 18 sessions, losing about a fifth of its value over that period.

U.S. consumer sentiment fell in March as consumers were less hopeful about the prospects for the overall economy, according to the Thomson Reuters/University of Michigan's final March reading on the overall index on consumer sentiment. While the report was up by 0.1 from the preliminary March read, it was also slightly under expectations.

"Sentiment was off a bit, but still reasonably high, which is encouraging," Ablin said. "It seems like we're getting past weather issues, which will allow us to look at fundamentals again."

As the first quarter draws to a close, trading may be influenced by "window dressing," when money managers adjust positions to improve the look of their portfolios.

(Editing by Jan Paschal)