By Chuck Mikolajczak
NEW YORK (Reuters) - U.S. stock index futures pointed to a flat open on Friday, following the biggest rally since the first trading day of the year, as talks continued in Washington to end a fiscal stalemate that has shut down the government for days.
After meeting at the White House on Thursday, President Barack Obama and Republican leaders appeared ready to end a crisis that has shut much of the U.S. government since October 1. The crisis began late in September as Republicans tied continued government funding to modifications to Obama's Affordable Care Act.
Although no deal emerged from the 90-minute meeting, talks continued into the night in an effort to re-open the government and extend the government's borrowing authority beyond an October 17 deadline.
The crisis in Washington threatens to damage the fiscal standing of the United States and to derail its fragile economic recovery.
"There seems to be some flexibility now, at least the talks are progressing," said Tim Ghriskey, chief investment officer of Solaris Group in Bedford Hills, New York
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"Once sanity returns, at least temporarily, to Washington the market really should move higher."
Major U.S. stock indexes staged their strongest rally in more than nine months on Thursday, leaving the S&P 500 less than 2 percent away from its record closing high set three weeks ago.
JPMorgan Chase & Co rose 1 percent to $53.06 in premarket trading, even as the biggest U.S. bank by assets reported a rare quarterly loss after incurring $9.2 billion in legal expenses. Excluding litigation expense and reserve release, it earned a profit of $5.82 billion, or $1.42 a share.
Wells Fargo & Co fell 1.8 percent to $40.69 in premarket after the biggest U.S. mortgage lender reported a 13 percent rise in third-quarter profit, but its mortgage banking income fell sharply as the refinancing boom began to fade.
S&P 500 futures shed 0.2 point and were slightly 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 gained 10 points and Nasdaq 100 futures added 3.75 points.
Later in the session at 9:55 a.m. EDT (1355 GMT), the Thomson Reuters/University of Michigan Surveys of Consumers October preliminary consumer sentiment index is due to be released. Economists in a Reuters survey expect a reading of 76.0 compared with 77.5 in the final September report.
Micron Technology Inc fell 1.9 percent to $18.08 before the opening bell, after the chipmaker reported a smaller-than-expected fourth-quarter profit on Thursday.
(Editing by Bernadette Baum)