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Futures up: Dow 0.04%, S&P 500 0.16%, Nasdaq 0.24%

Aug 26 (Reuters) - U.S. stock index futures edged higher

on Monday, with investors focused mainly on results from

AI-favorite Nvidia ( NVDA ) and a key inflation report due later in the

week, while confidence in a September interest-rate cut by the

central bank remained high.

Markets lauded Federal Reserve Chair Jerome Powell's

comments on Friday, when he said "the time has come" to lower

borrowing costs in the light of diminishing upside risk to

inflation and moderating labor demand.

The main indexes rallied more than 1% in the previous

session, with the S&P 500 and the Dow less than 1%

from their respective record highs. Rate-sensitive small caps

logged their strongest day in six week, as equities

continued to pare losses from the early August market rout.

Traders are now betting on a 25-basis-point or

50-basis-point rate cut in September. Odds of the former have

dropped to 63.5%, from more than 70% in the previous week, while

odds of a 50-bps cut have risen to 36.5%, from about 30% last

week, according to the CME Group's Fed Watch tool.

Attention will turn to Friday's July Personal Consumption

Expenditure data, the central bank's preferred inflation gauge.

At 05:28 a.m., Dow E-minis were up 15 points, or

0.04%, S&P 500 E-minis were up 9.25 points, or 0.16%, and Nasdaq

100 E-minis were up 47.75 points, or 0.24%.

As earnings season draws to a close, chip designer Nvidia ( NVDA )

, whose results are scheduled on Wednesday, traded

nearly 1% higher in premarket trading.

Markets have been less forgiving this quarter of highly

valued megacap stocks, which spearheaded the excitement around

artificial intelligence.

They will scrutinize Nvidia's ( NVDA ) earnings to justify the

stock's more than 160% year-to-date jump, which pushed its

market cap value to No. 2, just below that of Apple ( AAPL ), as

of Friday's close.

Results from Dell, Salesforce ( CRM ), Dollar

General ( DG ) and Gap are also awaited through the

week.

Comments from San Francisco Fed President Mary Daly, a

Federal Open Market Committee voting member this year, are due

later in the day.

With the geopolitical tensions in the Middle East in the

spotlight, crude prices climbed over 1%.

Among others, BJ's Wholesale Club rose 1.4% after

brokerage J.P.Morgan lifted its rating on the club operator to

"neutral" from "underweight".

B Riley Financial ( RILY ) dropped 1.8% after the lender

announced a notification of delinquency with the Nasdaq.