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Futures down: Dow 0.6%, S&P 500 0.7%, Nasdaq 0.9%

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PepsiCo ( PEP ) gains after report Elliott plans activist campaign

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Gold miners gain as bullion prices hit record high

(Updates prices, adds quote)

By Purvi Agarwal and Ragini Mathur

Sept 2 (Reuters) -

U.S. stock index futures fell on Tuesday, as investors

returning from a long holiday weekend shifted their focus to

upcoming crucial economic reports, which could shape the Federal

Reserve's stance on monetary easing.

The August nonfarm payrolls report, due on Friday, is the

centerpiece of the week and will follow a monthly private

payrolls reading and job openings figures.

Markets are pricing in about a 92% chance of a

25-basis-point cut in interest rates at the Fed's meeting later

this month, according to the CME Group's FedWatch tool.

Investors' dovish tilt came after July's weak job report,

with Fed Chair Jerome Powell acknowledging the growing risks to

the labor market at the Jackson Hole symposium, helping the S&P

500 and the Dow log their fourth consecutive month of gains in

August.

The Nasdaq logged its fifth straight monthly gain last

month.

At 7:40 a.m. ET, Dow E-minis were down 253 points,

or 0.55%, S&P 500 E-minis were down 47.75 points, or

0.74% and Nasdaq 100 E-minis were down 220.75 points, or

0.94%.

Yields on longer-dated U.S. Treasuries rose on Tuesday, with

those on the 10-year and 30-year notes

at their highest levels in more than a month, pressuring

equities.

The CBOE Market Volatility index also touched its

highest mark in more than three weeks and was last up 1.84

points at 17.96.

Hedge funds remained hesitant about buying U.S. stocks at

the outset of seasonally dour September, according to Goldman

Sachs data up to August 25.

The benchmark S&P 500 has lost 1.5% on average in September

- its worst month - since 2000, according to data compiled by

LSEG. DataTrek Research said it is the only month since 1958

where the index's mean returns are negative.

"September is historically a weak month for equities ... The

combination of tariff uncertainty, Fed concerns, and seasonal

weakness has left markets on edge," said David Morrison, senior

market analyst at TradeNation.

A divided U.S. appeals court ruled on Friday that most

of U.S. President Donald Trump's tariffs are illegal,

undercutting his use of these levies.

Some worries also persisted about the Fed's

independence, as Trump kept up attacks on the central bank.

The markets will also focus on quarterly earnings from a

host of retailers to gauge the strength of the U.S. consumer as

the impact of Trump's tariffs on the economy starts to show.

U.S. manufacturing activity data for August is due after

markets open.

A White House official said that Trump would make an

announcement related to the U.S. defense department on Tuesday.

In stocks, gold miners gained in premarket trading after

bullion prices hit a record high. U.S.-listed shares of Harmony

Gold rose 6.6%, Kinross Gold gained 3% and

Newmont ( NEM ) added 2%.

PepsiCo ( PEP ) shares gained 4.7% after a report by the

Wall Street Journal said Elliott Management had taken a $4

billion stake in the beverages giant and was planning an

activist campaign.

Fortinet ( FTNT ) fell 3.5% after Morgan Stanley

downgraded the cybersecurity firm's stock.