U.S. stock index futures rose sharply on Tuesday, tracking gains in global equity markets, as investors looked to rebound from its worst week in two months.

* We are looking at a nice bounce here, said Peter Cardillo, chief market economist at Avalon Partners in New York. It's all about bargain hunting this morning. Cardillo said the market was heavily oversold, with sentiment too negative.

* At the start of a trading week shortened by the U.S. Independence Day holiday, investors will monitor the ISM non-manufacturing report due at 10 a.m. EDT, amid concerns that an economic recovery may be slowing. Economists look for a reading of 55.0 versus 55.4 in the previous report.

* Stocks sold off last week after the ISM manufacturing survey came in much weaker than expected.

* Banks and technology shares were among the early gainers, with Goldman Sachs Group Inc rising 2.3 percent to $134.10 in premarket trading, and Apple Inc up 1.5 percent to $250.70.

* S&P 500 futures added 11.2 points and were above

fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures jumped 105 points, and Nasdaq 100 futures increased 28 points.

* The S&P 500 fell every day last week and has declined 8.3 percent since the beginning of the year. Signs of weakness in the labor and housing markets as well as a potential slowdown in manufacturing have worried investors.

* Dallas Federal Reserve President Richard Fisher said the timing of monetary tightening will depend on conditions in the U.S. economy, which will slow in the latter half of the year, he told Japan's Nikkei newspaper on Tuesday.

* Technically, the market still looks fragile. The S&P 500's 50-day moving average broke below its 200-day moving average -- known as the death cross -- which analysts said could signal more losses ahead.

* In Europe, stocks bounced back from a six-week closing loss following strength in Asian equity markets. Europe's FTSEurofirst 300 <.FTEU3> rose 2.4 percent near midday, while Japan's leading Nikkei average <.N225> bounced off a 7-month low to close up nearly 1 percent.

* Australia, which relies on demand for its natural resources from Asia's commodity-hungry economies, remained upbeat on the outlook for Asia and held its key cash rate steady for a second month.

* BP Plc has approached sovereign wealth funds with a view to securing a strategic investor to fend off takeover bids while it deals with its massive U.S. oil spill, a senior United Arab Emirates source said on Tuesday. BP's New York traded stock rose 6.5 percent to $31.26.

(Reporting by Edward Krudy; editing by Jeffrey Benkoe)

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