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Futures up: Dow 0.06%, S&P 500 0.04%, Nasdaq 0.10%

July 5 (Reuters) - U.S. stock index futures inched up at

the end of a week that saw signs of a softening economy raising

hopes of an interest rate cut in September, with investors

gearing up for yet another key employment report after returning

from a July 4th holiday.

A Labor Department report, due at 8:30 a.m. ET, is expected

to show non-farm payrolls rose by 190,000 in June after

advancing by 272,000 jobs in May, while unemployment rate likely

remained unchanged at 4% and average hourly earnings rose 0.3%

after rising 0.4% the previous month.

"The NFP number has come in above forecasts in eight cases

out of the last 10 ... makes it harder for the Fed to justify

rate cuts, as a tight labor market can easily increase

inflationary pressures," noted David Morrison, senior market

analyst at Trade Nation.

The ADP Employment report and weekly jobless claims earlier

this week signaled easing labor market conditions, while a

measure of services sector activity dropped to a four-year low

and factory orders slumped unexpectedly.

"Disappointing ISM Services PMI is another indication that

the economy is slowing down. Yet again, the Fed has to balance

the risk of cutting too soon, before inflation is properly

beaten, or leaving it too late and risking a recession,"

Morrison added.

Taking cues from the data points, market participants

strengthened their bets for this year's rate cuts.

Chances of a 25-basis-point cut in September had risen to

68% from last week's 58%, as per CME Group's FedWatch Tool.

At 5:11 a.m. ET, Dow e-minis were up 25 points, or

0.06%, S&P 500 e-minis were up 2.25 points, or 0.04%,

and Nasdaq 100 e-minis were up 21 points, or 0.1%.

The S&P 500 and the Nasdaq notched record closing highs in

Wednesday's holiday-shortened trading. With the equity market

also staying shut for U.S. Independence Day on Thursday, trading

volumes have been light throughout the week.

All the three major Wall Street indexes are poised for

weekly gains, after high-momentum top technology stocks steered

the S&P 500 and the Nasdaq to strong gains in the first half of

the year.

Remarks by New York Fed President John Williams, during the

day, will also be monitored after the Fed's June policy meeting

minutes showed officials acknowledged a slowing economy and

diminishing price pressures, yet counseling a wait-and-see

approach before committing to rate cuts.

Among early premarket movers, Tesla rose 1.7% after

hitting its highest level since early January on Wednesday.

Macy's climbed 2% after a media report said Arkhouse

Management and Brigade Capital Management raised their bid to

buy the department store chain for about $6.9 billion.

Cryptocurrency-related stocks including Coinbase Global ( COIN )

, Riot Platforms ( RIOT ) and Marathon Digital ( MARA )

lost 7%-8% after bitcoin slumped to an over four-month

low as traders fretted over the likely dumping of tokens from

defunct Japanese exchange Mt. Gox and further selling by

leveraged players.

(Reporting by Ankika Biswas in Bengaluru; Editing by Saumyadeb

Chakrabarty)