US STOCKS-Wall street set for muted open, retail earnings mixed

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* Home Depot, Kohl's rises after profit beat
* Elanco Animal Health drops on deal to buy Bayer's unit
* Medtronic gains on FY forecast raise
* Futures up: Dow 0.05%, S&P 0.03%, Nasdaq 0.07%

(Adds comment, details; Updates prices)
By Medha Singh
Aug 20 (Reuters) - Wall Street looked set to open little
changed on Tuesday after three days of gains, with a mixed bag
of retail earnings keeping investors guessing about the health
of U.S. consumer demand.
After a stormy start to the month on worsening U.S.-China
trade tensions, the three main indexes have rebounded sharply,
with the S&P 500 .SPX and the Nasdaq .IXIC erasing last
week's losses on signs Germany and China are considering
stimulus.
A report late on Monday said White House officials are
discussing the possibility of a temporary payroll tax cut in an
effort to boost the economy. But a White House official rejected
the report in comments to Reuters. "Today just looks like a digestion day of recent gains and
there is not a lot of news that would swing the market wildly in
either direction," said Aaron Clark, portfolio manager at GW&K
Investment Management in Boston, Massachusetts.
Home Depot Inc HD.N cut its full-year sales forecast,
citing the potential impact of the trade war on consumer
spending, although its shares rose 2.6% as the company beat
expectations for profit. Smaller rival Lowe's Companies Inc
LOW.N , which reports later this week, was up 1.8%.
Department store operator Kohl's Corp KSS.N jumped 3.7%
after reporting better-than-expected quarterly profit and
revenue. Shares of rivals Macy's Inc M.N and Nordstrom Inc
JWN.N were marginally higher. TJX Cos Inc TJX.N fell more than 3% after off-price
retailer posted same-store quarterly sales that fell short of
estimates for the first time in more than a year.
All eyes this week will be on Wednesday's release of minutes
from the Federal Reserve's July policy meeting and Chair Jerome
Powell's speech on Friday at the Jackson Hole central bankers'
conference.
Powell's remarks will be closely monitored for hints if more
policy easing is in store, against the backdrop of an escalating
trade war and growing fears of recession, signaled by the
inversion of the U.S. yield curve last week.
Even as Powell classified last month's interest rate cut as
a "mid-cycle" policy adjustment, traders are currently fully
pricing in another rate cut in September.
"I don't think Powell will have an overly dovish tone
compared to what the markets are expecting ... The consumer,
which is by far the largest piece of the U.S. economy, is still
pretty healthy," Clark said.
At 8:45 a.m. ET, Dow e-minis 1YMcv1 were up 14 points, or
0.05%. S&P 500 e-minis EScv1 were up 0.75 points, or 0.03% and
Nasdaq 100 e-minis NQcv1 were up 5.5 points, or 0.07%.
The benchmark S&P 500 .SPX fell as much as about 7% from
its July record high last week, but is now down only about 3%
from that level.
Medtronic Plc MDT.N gained 4.5% after the medical device
maker raised its full year adjusted profit forecast.
Elanco Animal Health ELAN.N slid about 7% on agreeing to
buy Bayer's BAYGn.DE veterinary drugs unit in a $7.6 billion
cash and stock deal, creating the second largest animal health
business.