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Non-farm payrolls data scheduled for 8:30 a.m. ET

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Tesla extends gains

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Futures: Dow down 0.03%, S&P 500 up 0.02%, Nasdaq up 0.16%

(Updated at 7:16 a.m. ET/1116 GMT)

By Ankika Biswas and Lisa Pauline Mattackal

July 5 (Reuters) - U.S. stock index futures traded flat

to slightly higher on Friday as markets reopened after the July

4 holiday, with investors hoping a crucial employment report

would be the latest piece of data to confirm further weakness in

the labor market.

The Labor Department's report due at 8:30 a.m. ET is

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

advancing by a sharply higher 272,000 jobs in May. The

unemployment rate is forecast to remain unchanged at 4%, and

average hourly earnings are seen rising 0.3%.

A softer reading would potentially boost the chances of a

Federal Reserve interest rate cut in September, following on the

heels of the ADP Employment and weekly jobless claims reports

this week which signaled easing labor market conditions.

Earlier this week, data showed a measure of services sector

activity dropped to a four-year low and factory orders slumped

unexpectedly.

Taking cues from the data points, market participants

strengthened their bets for multiple rate cuts this year.

"To see a major repricing in Fed rate expectations to the

dovish side ... we may need to see payrolls slow below 150k,

considering the June Fed Dot Plot and rising perceived

probability of a Trump win in November work as hawkish

counterweights," analysts at ING said.

Chances of a September interest rate cut have risen to more

than 74% from last week's 64%, according to CME Group's FedWatch

Tool.

That helped the S&P 500 and the Nasdaq notch record closing

highs during 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.

At 7:16 a.m. ET, Dow e-minis were down 10 points,

or 0.03%, S&P 500 e-minis were up 1.25 points, or 0.02%,

and Nasdaq 100 e-minis were up 32.25 points, or 0.16%.

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.

With second-quarter earnings on the horizon, it remains to

be seen whether Wall Street's rally will broaden beyond major

megacap stocks and whether earnings for those companies can

continue to support steep valuations.

New York Fed President John Williams said on Friday that

while the U.S. economy was doing "remarkably well," there was

still a "way to go" for the Fed to bring inflation back to its

2% target.

Among premarket movers, Tesla rose 1.2% after

hitting its highest level since early January on Wednesday.

Macy's climbed 6.3% after a report said Arkhouse

Management and Brigade Capital 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 5%-6% after bitcoin slumped to a more than

four-month low as traders fretted over the likely dumping of

tokens from defunct Japanese exchange Mt. Gox and further

selling by leveraged players.