US STOCKS-Stimulus hopes lift futures, S&P 500 set for second straight weekly gain

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* Futures up: Dow 0.31%, S&P 0.31%, Nasdaq 0.15%

By Devik Jain
Oct 9 (Reuters) - U.S. stock index futures rose on Friday,
setting the S&P 500 up for its second weekly gain in a row as
hopes for more fiscal aid boosted optimism against the backdrop
of political uncertainty ahead of the presidential election.
After stalling talks with Democrats on a comprehensive aid
package earlier this week, U.S. President Donald Trump on
Thursday called for a "skinny" relief bill that would include
elements such as direct payments and a bailout to the struggling
airline sector. Recent trading on Wall Street - particularly in shares of
U.S. airlines, which began mass furloughs after a previous
payroll support package expired - has been dictated by
negotiations between the White House and Democrats on more
fiscal aid.
After sinking 3% on Tuesday as Trump broke off aid talks,
the S&P airlines subindex .SPCOMAIR has jumped in the past two
sessions and is on track for one of its best months this year.
Strategists say investors have also begun to price in the
possibility of Democratic presidential nominee Joe Biden winning
the Nov. 3 election, with a recent Reuters/Ipsos poll showing
Americans were steadily losing confidence in Trump's handling of
the COVID-19 pandemic. Gains in U.S. stocks this week have been concentrated in
small- .SPCY and mid-cap .IDX firms, which stand to benefit
more from a Biden victory than the large-cap companies that had
so far fueled Wall Street's recovery from the coronavirus lows
hit in March, fund managers said. Attention from next week will also be on Corporate America's
third-quarter earnings season, kicked off by JPMorgan Chase & Co
JPM.N , Citigroup Inc C.N and drugmaker Johnson and Johnson
JNJ.N . Analysts expect earnings at S&P 500 firms to have dropped
about 21% in the quarter, according to IBES data from Refinitiv.
At 6:53 a.m. ET, Dow e-minis 1YMcv1 were up 89 points, or
0.31%, S&P 500 e-minis EScv1 were up 10.5 points, or 0.31%,
and Nasdaq 100 e-minis NQcv1 were up 17 points, or 0.15%.
In company news, Xilinx Inc XLNX.O surged 17.0% after a
report said Advanced Micro Devices Inc AMD.O was in talks to
buy the chipmaker in a deal that could be valued at more than
$30 billion. Shares of AMD fell 5.8%.