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markets, click or type LIVE/ in a news window.)

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U.S. Steel drops after Biden halts Nippon Steel's ( NISTF ) takeover

plan

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Liquor stocks fall after US surgeon general's warning

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Dec. ISM Manufacturing data awaited

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Futures up: Dow 0.33%, S&P 500 0.37%, Nasdaq 0.48%

(Updates to before markets open)

By Johann M Cherian and Pranav Kashyap

Jan 3 (Reuters) - Wall Street's main indexes were poised

to open higher on Friday, as investors kept a close eye on

upcoming economic data and geared up for potential policy shifts

under the incoming Trump administration.

At 08:34 a.m. ET, Dow E-minis were up 140 points,

or 0.33%, S&P 500 E-minis were up 21.75 points, or 0.37%

and Nasdaq 100 E-minis were up 101 points, or 0.48%.

Wall Street had a rocky start to the new year, with all

three major indexes shedding early gains to close lower for the

fourth consecutive session on Thursday. The downturn defied a

historical trend where markets typically rally during the last

five sessions of December and the first two sessions of January.

The benchmark S&P 500 and blue-chip Dow are on

track for weekly declines of over 1% each, while the tech-heavy

Nasdaq has logged a drop of about 2%. Technology stocks

that have led much of the rally over the past two

years took the heaviest beating.

Analysts have highlighted uncertainty surrounding the

policies that President-elect Donald Trump's administration

might roll out, especially with his Republican party holding

sway over Congress. The newly elected Congress will begin its

first session on Friday, with Trump set to take the oath of

office on Jan. 20.

Trump's proposals, ranging from slashing corporate taxes and

easing regulations to imposing tariffs and curbing illegal

immigration, could boost corporate profits and energize the

economy. However, they also pose certain risks.

"It's a complicated picture. At first, investors were

thinking back in November that (election results) is a wonderful

thing because it is a clear market friendly result," said Peter

Andersen, founder of Andersen Capital Management.

"The main issue people will start focusing on is, if his

decisions will be inflationary and if they are, does that signal

that the Fed will do an abrupt course change and start raising

rates."

Traders now expect the Federal Reserve to lower rates by

about 50 basis points this year, per the CME Group's FedWatch

Tool.

Meanwhile, the yield on the 10-year Treasury note

remains anchored near the psychological level of

4.5%.

Inflows into U.S. equity funds experienced a sharp decline

in the week leading up to Jan. 1.

Later in the day, markets will parse ISM's report on

manufacturing activity for December, ahead of a key employment

figure due next week.

Comments from Richmond Fed President Thomas Barkin are also

on tap.

Stretched equity valuations have been a concern for

investors but most brokerages expect another year of gains for

U.S. stocks, propelled by strong corporate performance.

In premarket trade, alcoholic beverage makers such as

Constellation Brands ( STZ ), Molson Coors ( TAP/A ), and

Brown-Forman ( BF/A ) slipped more than 1%, after the U.S.

surgeon general urged cancer warnings for alcoholic drinks.

U.S. Steel slid 8% after President Joe Biden blocked

Nippon Steel's ( NISTF ) proposed $14.9 billion purchase of the

company.

Block rose 3.1% after brokerage Raymond James raised

its rating to "outperform" from "market perform".

Trading volumes are expected to be subdued following the New

Year's holiday on Wednesday.