*

Futures off: Dow 0.06%, S&P 500 0.07%, Nasdaq 0.16%

*

U.S. to allow Nvidia H200 chip shipments to China

*

Warner Bros fight heats up with $108 bln hostile bid from

Paramount

(Updates to before markets open)

By Johann M Cherian and Pranav Kashyap

Dec 9 (Reuters) - Wall Street's main stock indexes were

set to open little changed on Tuesday as investors awaited the

Federal Reserve's policy decision, while Nvidia ( NVDA ) shares were

whipsawed by contrasting news around exports of advanced AI

chips to China.

Nvidia ( NVDA ) shares rose as much as 2% in premarket

trading after U.S. President Donald Trump said he would allow

the company to ship H200 processors, its second-most powerful AI

chips, to China but will collect a 25% fee on those exports.

The stock, however, pared some of those gains after a

Financial Times report said that Beijing was set to curb or

block domestic companies from purchasing these chips.

Export controls on U.S. chips capable of powering AI have

been a central point of friction in trade talks between

Washington and Beijing this year.

"While the deal does not include the most powerful Blackwell

chips, it is a positive step towards maintaining the current

good trade relations between the two largest economies," said

Achilleas Georgolopoulos, senior market analyst at brokerage XM.

Advanced Micro Devices ( AMD ) and Intel ( INTC ) were

marginally higher, as Trump said a similar approach would apply

to other semiconductor companies.

At 8:35 a.m. ET, Dow E-minis were down 30 points,

or 0.06%, S&P 500 E-minis were down 4.5 points, or 0.07%

and Nasdaq 100 E-minis were down 41.75 points, or 0.16%.

The spotlight this week is on the Fed's two-day policy

meeting, which kicks off on Tuesday and ends with a decision on

Wednesday.

Fresh data has shown that inflation is still stubborn and

running above the Fed's 2% target, even as secondary indicators

hint the once-red-hot labor market is starting to cool in some

sectors.

Traders now see an 89.6% chance of a 25-basis-point rate cut

this week, according to CME's FedWatch Tool, though policymakers

remain divided.

Several policymakers have cautioned that price pressures

could easily reaccelerate in the months ahead.

Even so, markets are still penciling in another 50 basis

points of easing next year as the Fed seeks to safeguard a

softening jobs backdrop.

Investors are awaiting Tuesday's 10 a.m. ET release of the

October JOLTS report, which will offer them one last look at

labor market data before Wednesday's Fed decision.

Expectations for Fed rate cuts have underpinned risk-taking,

bringing Wall Street's S&P 500 within 1% of a record

high, while an index tracking small caps has outperformed

the benchmark index this quarter.

Traders also kept an eye on a bidding war between Paramount

Skydance ( PSKY ) and Netflix ( NFLX ) over Warner Bros

that has lifted shares of the iconic Hollywood studio by 11% in

the past two sessions. Warner Bros shares added 1.2% in Tuesday

premarket trading.

Home improvement chain Home Depot lost 2.5% after

forecasting fiscal 2026 comparable sales growth and profit below

estimates.

CVS Health gained 3% after the health insurer

forecast 2026 profit above estimates.

(Reporting by Johann M Cherian and Pranav Kashyap in Bengaluru;

Editing by Tasim Zahid and Saumyadeb Chakrabarty)