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Futures up: Dow 0.24%, S&P 500 0.22%, Nasdaq 0.28%

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PCE data due at 8:30 a.m. ET

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Nike ( NKE ) rises after better-than-expected Q1 revenue forecast

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UBS lifts S&P 500 index's annual target on fading trade

tensions

(Updates with prices and comment)

By Kanchana Chakravarty and Nikhil Sharma

June 27 (Reuters) -

U.S. stock index futures surged on Friday, putting the S&P

500 and the Nasdaq on track for record highs as investors geared

up for a key inflation report amid signs of a dovish policy

outlook from the Federal Reserve this year.

Personal Consumption Expenditure data - the U.S. central

bank's preferred inflation gauge - for May is due to be released

at 08:30 a.m. ET and will be scrutinized to assess the Fed's

interest-rate path as tariffs weigh on prices.

As the ceasefire in the Middle East holds, investor focus

has turned to the prospect of a dovish Fed after the Wall Street

Journal reported that U.S. President Donald Trump toyed with the

idea of announcing Fed Chair Jerome Powell's replacement by

September or October.

"News that Donald Trump may announce his pick to be the new

Fed chair with months to go has led the interest rate futures

market to ramp up bets that interest rates in the U.S. will be

cut sharply over the coming months and years," Kathleen Brooks,

research director at XTB, said in a note.

A spate of economic data this week, including a

weaker-than-expected first quarter GDP reading as well as

jobless claims reaching multi-year highs, has supported the case

for the central bank to cut borrowing costs this year.

Traders now price in a 20.7% chance of a rate cut in July,

compared with 14.5% last week, according to CME Group's FedWatch

tool.

At 06:30 a.m. ET, Dow E-minis were up 103 points, or

0.24%, S&P 500 E-minis were up 13.5 points, or 0.22%,

and Nasdaq 100 E-minis were up 63.5 points, or 0.28%.

Nike's ( NKE ) shares rose 9.2% in premarket trading after

the retailer forecast a smaller-than-expected drop in

first-quarter revenue.

Retailer Lululemon Athletica ( LULU ) rose 1.4% after Nike's ( NKE )

results, while Hoka-owner Deckers Outdoor ( DECK ) added 2.1%.

On the flip side, gold stocks slipped in premarket

trading as bullion neared a one-month low. Top miners such as

Newmont ( NEM ) and U.S.-listed Barrick Mining were down

2.3% and 2%, respectively.

The benchmark S&P 500 and the Nasdaq are on

track for their best weekly performance in six weeks, while the

blue-chip Dow is set for a weekly advance, if gains hold.

UBS Global Wealth Management raised its year-end target for

the S&P 500 index to 6,200 from its prior forecast of

6,000, banking on softening trade uncertainty.

Adding to the upbeat sentiment, Washington reached an

agreement with China on expediting rare-earth shipments to the

United States, a White House official said, days ahead of the

July 9 deadline for Trump's "reciprocal" tariffs.

Also on tap is the final reading of consumer sentiment for

June, measured by the University of Michigan Surveys of

Consumers, due at 10:00 a.m. ET.

Remarks from New York Fed President John Williams, Cleveland

Fed President Beth Hammack and Fed Board Governor Lisa Cook are

expected later in the day.