By Andrea Shalal

WASHINGTON (Reuters) - The U.S. Senate on Thursday approved a revamp of the 26-year-old North American Free Trade Agreement that includes tougher rules on labor and automotive content but leaves $1.2 trillion in annual U.S.-Mexico-Canada trade flows largely unchanged.

The legislation to implement the U.S.-Mexico-Canada Agreement passed on an 89-10 bipartisan vote, sending the measure to President Donald Trump for him to sign into law.

The Democratic-controlled U.S. House of Representatives passed the legislation on Dec. 19 after hammering out changes to ensure better enforcement of labor rights and tighter environmental rules during months of often contentious negotiations with the Trump administration.

The Senate vote came a day after Trump signed a long-awaited Phase 1 trade deal with China, and shortly before the Senate formally began the impeachment trial of Trump on charges that he abused his power.

The U.S. S&P 500 stock index hit the 3,300 mark on Thursday for the first time, buoyed by the two trade deals, solid retail sales and upbeat Morgan Stanley earnings.

U.S. Treasury Secretary Steven Mnuchin said Trump's efforts to rebalance U.S. ties with its major trading partners were bearing fruit, and boosting U.S. economic growth.

"This historic agreement not only modernizes and rebalances our trade relationship with Canada and Mexico, but it promotes economic growth, creates jobs, and provides crucial certainty for farmers, workers and manufacturers," he said in a statement.

On Wednesday, Mnuchin told Fox News that interim trade deal with China and passage of USMCA would boost growth of the U.S. gross domestic product by 50 to 75 basis points.

Mexican President Andres Manuel Lopez Obrador on Thursday called the deal's approval good news for the Mexican economy, and predicted it would jump start new investments.

Canada still needs to approve the deal before it can take effect and replace NAFTA. It was signed by the leaders of the United States, Mexico and Canada in September 2018.

Trump made renegotiating NAFTA a centerpiece of his 2016 election campaign, calling it "the worst trade deal ever made" and blaming it for the loss of thousands of American factory jobs to low-wage Mexico.

He had threatened to cancel NAFTA outright unless Congress acted to approve the replacement deal, sparking uncertainty among business owners and putting a damper on new investment.

The AFL-CIO union federation, which represents some 12.5 million workers across the United States, estimates that some 851,700 U.S. jobs were lost to Mexico because of NAFTA.