Stock index futures were lower on Monday on growing sentiment U.S. interest rates could rise sooner than had been anticipated following last week's surprisingly optimistic jobs report.

Interest rate concerns will be at the forefront with Federal Reserve Chairman Ben Bernanke scheduled to speak at the Economic Club of Washington at 12:45 p.m. Data on Friday showed U.S. employers cut 11,000 jobs in November, far fewer than expected and the smallest decline since the start of the recession in December 2007.

Keeping interest rates near zero has been part of the Federal Reserve's efforts to thaw credit markets and pull the economy out of recession. Investors are wary the central bank will raise rates before the economic recovery has been firmly established.

With the job report from Friday bolstering confidence in an economic rebound, there seems to be a growing talk that interest rates will rise, said Andre Bakhos, president of Princeton Financial Group in North Brunswick, New Jersey.

There's only so much money that can be thrown at the economy. At some point it has to end and the fear is, it's not going to be pretty.

Higher interest rates would also boost the U.S. dollar, which has traded in an inverse relationship to equities lately.

S&P 500 futures fell 2.5 points and were below 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 slipped 41 points, while Nasdaq 100 futures dipped 8 points.

Stocks climbed on Friday with the jobs report brightening the outlook for the economy and profits.

The projected long-term cost of the U.S. government's bailout of the nation's big banks is going to be at least $200 billion less than previously thought, a Treasury Department official said on Sunday night.

Cadbury Plc said it would post a formal response to Kraft Food Inc's $16 billion takeover offer on December 14.

Citigroup Inc is trying to persuade the U.S. government to allow it to repay $20 billion in taxpayer funds before a window to launch a share sale effectively shuts by the middle of next week, the Financial Times reported on Sunday.

Also in the financial sector, five senior executives at American International Group Inc told the insurer last week they may quit if their compensation is cut significantly by the U.S. pay czar, the Wall Street Journal reported on Sunday.

Energy giant Exxon Mobil Corp has made final a gas sales contract with Japan's Tokyo Electric Power <9501.T> for its project in Papua New Guinea, putting the $15 billion development on track for approval on Tuesday.

Intel Corp has scrapped plans to launch an advanced graphics chip based on its novel Larrabee design after concluding that delays in the project would make it uncompetitive, a spokesman said on Sunday.

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