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Futures up: Dow 0.05%, S&P 500 0.04%, Nasdaq 0.03%

Aug 27 (Reuters) - U.S. stock index futures were flat on

Wednesday, as investors stepped aside in anticipation of AI

leader Nvidia's ( NVDA ) earnings release that will test Wall Street's

broader technology-led rally.

The chip major was at the forefront of the market recovery

after April's lows, crossing the $4-trillion market

capitalization mark in July to become the world's largest

company as investors continued to bet on the global demand for

artificial-intelligence infrastructure.

The company's results come at a time when traders have been

worried the tech sector - that makes up nearly 50% of

the S&P 500 - might be overvalued. Valuations of the

benchmark index are well above long-term averages, according to

data compiled by LSEG.

The concerns weighed on the tech sector last week after

OpenAI CEO Sam Altman spoke of a potential bubble and a study

from the Massachusetts Institute of Technology showed that AI

tools were only a boost to individual productivity, and not

corporate earnings.

Nvidia's ( NVDA ) shares edged up 0.5% in premarket trading,

ahead of its earnings, which are expected after markets close.

Options traders are pricing in about a $260-billion swing in the

chipmaker's market value after the results.

How the company's significant China business fared during

the Sino-U.S. trade war earlier this year will be closely

watched along with how a recent revenue-sharing deal with the

U.S. government will impact forecasts.

"In the same way Apple symbolized the smartphone era, Nvidia ( NVDA )

now defines the AI era. The stock has become the heartbeat of

the market," said Josh Gilbert, market analyst at eToro.

"Regardless of whether you own Nvidia ( NVDA ) shares or not, its

result will impact your portfolio in some way."

At 05:26 a.m. ET, Dow E-minis rose 25 points, or

0.05%, S&P 500 E-minis were up 2.5 points, or 0.04%, and

Nasdaq 100 E-minis gained 6 points, or 0.03%.

Microsoft ( MSFT ) and Meta, top customers of the

chip leader, were broadly subdued, as were semiconductor stocks

Broadcom ( AVGO ) and Advanced Micro Devices ( AMD ).

Markets were also stabilizing following an initial decline

on Tuesday, after U.S. President Donald Trump attempted to fire

Federal Reserve governor Lisa Cook.

The move is likely to face legal challenges, but if

successful, it could allow Trump to nominate a dovish-leaning

official to the central bank board and worry investors concerned

about the U.S. Federal Reserve's independence.

Investors are pricing in a 25-basis-point interest-rate cut

in September, according to data compiled by LSEG, and most big

brokerages also lean in that direction.

Richmond Fed President Thomas Barkin's comments will be

scrutinized later in the day for his perspective on the monetary

policy outlook.

MongoDB ( MDB ) jumped 29.8% after the software-maker raised

its annual profit forecast.

Cracker Barrel gained 6.5% after the restaurant

chain said it would stick with its decades-old logo as plans for

a new one faced social media backlash.

U.S.-listed shares of Canada Goose rose 8.6% after

a report said controlling shareholder Bain Capital had received

bids to take the luxury goods maker private.

Quarterly reports from retailers including Abercrombie &

Fitch ( ANF ) and Kohl's are also due on the day.