REFILE-US STOCKS-Wall Street set to open higher on rate cut optimism

(Refiles with no changes to text)
* Banks gain as yields rise
* Illumina tumbles on weak preliminary revenue estimate
* Altria rises on Goldman Sachs upgrade
* Futures up: Dow 0.30%, S&P 0.22%, Nasdaq 0.20%

By Shreyashi Sanyal
July 12 (Reuters) - Wall Street looked set to open higher on
Friday, putting the three indexes on track to extend this week's
strong run fueled by rising expectations of an interest rate cut
this month.
In his two-day testimony before Congress, Federal Reserve
Chairman Jerome Powell said the U.S. economy was still under
threat from disappointing factory activity, tame inflation and a
simmering trade war and that the central bank stood ready to
"act as appropriate."
"He (Powell) has said everything he can, short of saying
flat out that we are going to cut interest rates," said Randy
Frederick, vice president of trading and derivatives for Charles
Schwab in Austin, Texas.
"Fed fund futures were telling us for a month that was going
to happen, but Powell has pretty much confirmed that's the
case."
The S&P 500 index .SPX traded above the 3,000 level for a
second day in a row on Thursday, with stronger-than-expected
U.S. inflation data failing to shake expectations of a rate cut.
Keeping investors on edge was Beijing's threat to impose
sanctions on U.S. firms that sell arms to Taiwan after
Washington approved possible sales of $2.2 billion in tanks,
missiles and related equipment. In the latest evidence that the U.S.-China trade dispute was
impacting growth, data showed that China's exports fell in June
and imports shrank more than expected. U.S. Treasury yields ticked higher, extending Thursday's
gains after an auction of $16 billion 30-year bonds saw weak
demand. US/
Morgan Stanley MS.N , JPMorgan Chase & Co JPM.N , Goldman
Sachs Group GS.N rose between 0.5% and 1.4% in premarket
trading. The shares were also boosted after Citigroup raised
price targets for the lenders ahead of earnings next week.
At 8:43 a.m. ET, Dow e-minis 1YMcv1 were up 81 points, or
0.3%. S&P 500 e-minis EScv1 were up 6.75 points, or 0.22%, and
Nasdaq 100 e-minis NQcv1 were up 15.5 points, or 0.2%.
Second-quarter earnings season start next week against the
backdrop of warnings of the trade war hurting corporate profits.
S&P 500 companies are expected to report a 0.4% dip in profits
from a year earlier, according to Refinitiv IBES data.
A Labor Department report showed U.S. producer prices rose
slightly in June, leading to the smallest annual increase in
producer inflation in nearly 2-1/2 years.
Producer price index (PPI) for final demand edged up 0.1%
last month against a forecast of unchanged PPI, according to
economists polled by Reuters.
Among other stocks, gene sequencing company Illumina Inc
ILMN.O tumbled 14.7% after its preliminary second-quarter
revenue came in below estimates. Altria Group Inc MO.N rose 1.5% on a report that Goldman
Sachs upgraded the Marlboro maker's stock to "buy" from
"neutral."
Ford Motor Co F.N rose 0.8% after the automaker and
Volkswagen AG VOWG_p.DE joined forces to develop autonomous
and electric cars.