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Futures up: Dow 0.22%, S&P 500 0.27%, Nasdaq 0.29%

Oct 3 (Reuters) - U.S. stock index futures rose on

Friday as hopes of an interest rate cut underpinned sentiment in

the final trading session of a volatile week, marked by a

government shutdown that has dragged into its third day.

The shutdown, which began on Wednesday, has disrupted the

flow of critical data that the Federal Reserve uses to assess

whether economic conditions justify an interest rate cut.

Among the data casualties is the closely watched nonfarm

payrolls report, which was scheduled for release on Friday but

has now been postponed, leaving investors to rely on other

indicators that have suggested softening in the labor market and

kept bets for a rate cut alive.

The optimism, coupled with strength in the technology

sector, has helped investors look past the impasse in Washington

so far.

The three major Wall Street indexes marked record closing

highs on Thursday and are on track to notch weekly gains should

current levels hold through Friday's session.

"Solid macroeconomic conditions, supported by healthy

consumer activity, combined with an opportunity for the Fed to

ease rates, have contributed to a market environment where stock

volatility has been largely contained," said Anthony Saglimbene,

chief market strategist at Ameriprise Financial.

At 05:07 a.m. ET, Dow e-minis were up 104 points, or

0.22%, U.S. S&P 500 E-minis were up 18 points, or 0.27%,

and Nasdaq 100 E-minis were up 72.5 points, or 0.29%.

Still, the rally has at times shown signs of fragility, with

stocks occasionally retreating as traders lock in gains.

Investors will now turn to the Institute for Supply

Management's non-manufacturing PMI data for September, due later

on Friday. Final readings of S&P Global services and composite

PMIs for September are also on deck.

These releases may carry outsized weight in shaping

near-term expectations for Fed action, making equities

susceptible to headline-driven swings.

Fed watchers will have a slate of central bank speakers to

parse on Friday. New York Fed President John Williams is set to

deliver a keynote address in Amsterdam, while Dallas Fed

President Lorie Logan will speak at a conference.

Fed Vice Chair Philip Jefferson will also discuss the U.S.

economic outlook and policy framework in Philadelphia.

Among individual stocks, Tesla rose 1.8% in

premarket trading after dropping more than 5% on Thursday.

Shares of USA Rare Earth ( USAR ) jumped 7.4% after its CEO

Barbara Humpton told CNBC that the company was "in close

communication" with the White House.