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US private payrolls rise less than expected in May, ADP

report

shows

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ISM Services PMI on tap at 10 a.m. ET

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CrowdStrike ( CRWD ) gains after strong Q2 forecast

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HPE climbs after upbeat revenue forecasts

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Futures up: Dow 0.18%, S&P 0.24%, Nasdaq 0.44%

(Updated at 8:32 a.m. ET/1232 GMT)

By Lisa Pauline Mattackal and Johann M Cherian

June 5 (Reuters) - U.S. stock index futures edged up on

Wednesday as investors strengthened bets for an imminent start

to rate cuts by the Federal Reserve, after a slew of reports

signaled a weakening labor market and slowing growth in the

world's largest economy.

A late rally saw Wall Street ending Tuesday's session

slightly higher, paring earlier losses, with rate-sensitive real

estate stocks and consumer staples leading

sector gains.

That was on the heels of initial declines, after data showed

U.S. job openings in April fell to their lowest in more than

three years - the latest report to suggest U.S. economic growth

is cooling - allowing the Federal Reserve more leeway to cut

interest rates.

Benchmark U.S. Treasury yields slipped to their lowest

level since April after the

ADP National Employment report showed

private employers increased their headcounts by 152,000 in

April, significantly lower than forecast.

Declining yields helped boost rate-sensitive megacap

stocks in premarket trading, with Nvidia ( NVDA ), Microsoft ( MSFT )

and Amazon.com ( AMZN ) up between

0.3

% and

1.2

%.

Traders now expect about 45 basis points of easing this

year, according to the LSEG rate probabilities app.

Additionally, expectations for a September rate reduction are

now at over 67%, versus below 50% last week, according to the

CME's FedWatch tool.

With major indexes near all-time highs, investors are

juggling worries of a weakening economy with hopes this would

lead to earlier policy easing than previously anticipated.

"The odds of recession have increased just from the data

that we've seen... the economy has tricked us and been more

resilient than people expect, but at some point it's going to

falter," said Thomas Martin, vice president and senior portfolio

manager at Globalt Investments.

He said some investors would also be more inclined to

book profits. "A few big names around AI have driven the market,

and when you have that kind of positioning and you get something

that's a little bit weaker... the market gets nervous."

Investors now await the nonfarm payrolls report, due

Friday, for a comprehensive evaluation of the labor market.

Surveys on the services sector from S&P Global and the Institute

for Supply Management, due later on Wednesday, will also be

closely watched.

At 8:32 a.m. ET, Dow e-minis were up 71 points, or

0.18%, S&P 500 e-minis were up 12.5 points, or 0.24%,

and Nasdaq 100 e-minis were up 82.75 points, or 0.44%.

Among others, Dollar Tree ( DLTR ) reversed earlier gains,

slipping 2.3% after a disappointing quarterly profit forecast.

The budget retailer said it would explore options that include a

potential sale or spin-off of Family Dollar.

Intel ( INTC ) gained 0.8% after buyout firm Apollo Global

Management ( APO ) agreed to purchase a 49% equity interest for

$11 billion, in a joint venture related to the chipmaker's

Ireland manufacturing unit.

Applied Materials ( AMAT ) added 2.2% after brokerage

Barclays upgraded the chip stock to "equal weight" from

"underweight".

CrowdStrike Holdings ( CRWD ) jumped 12.1% after forecasting

second-quarter revenue above estimates when markets closed on

Tuesday, helped by strong demand for its cybersecurity

offerings.

Hewlett Packard Enterprise ( HPE ) forecast third-quarter

revenue above Street expectations, helped by upbeat demand for

its AI servers, sending its shares up 15.7%.