US STOCKS-Futures up on cautious optimism of Washington resolution

Reuters

* U.S. lawmakers begin last-ditch effort on debt ceiling

* Bank of America posts profit as loan-loss provisions drop

* Futures up: Dow 65 pts, S&P 7.7 pts, Nasdaq 9 pts

NEW YORK, Oct 16 (Reuters) - U.S. stock index futures roseon Wednesday amid cautious optimism that U.S. politicians wouldstrike a last-minute deal to prevent the country from defaultingon its debt, an event that could roil markets and economiesworldwide.

* In another day of heavy earnings, Bank of America Corp reported a third-quarter profit of $2.22 billion,compared with a loss a year earlier, as provisions for creditlosses fell. The stock rose 1 percent in premarket trading.

* BlackRock Inc, the world's largest money manager,said its third-quarter profit grew 15 percent, amid strongglobal demand from its retail and institutional clients. Thestock was little changed in premarket trading.

* Apple Inc shares may be in the spotlightfollowing reports that the tech giant told manufacturers it willcut orders for its new iPhone 5C smartphone for the fourthquarter, according to a source familiar with the supply chainsituation.

* S&P 500 futures rose 7.7 points and were above fairvalue, a formula that evaluates pricing by taking into accountinterest rates, dividends and time to expiration on thecontract. Dow Jones industrial average futures rose 65points and Nasdaq 100 futures added 9 points.

* The U.S. Senate prepared for a last ditch effort Wednesdayto avoid a historic lapse in the government's borrowingauthority, a breach that President Barack Obama has said couldlead to default and deliver a damaging blow to the globaleconomy.

* After a day of stop-and-go negotiations, the top Democratand Republican in the U.S. Senate were said to be close toagreeing on a proposal to raise the debt limit - and reopen thepartially shuttered government - for consideration by the fullSenate on Wednesday.

* Markets were rattled by warnings by Fitch Ratings lateTuesday that it could cut the sovereign credit rating of theU.S. from AAA, citing the political brinkmanship over raisingthe federal debt ceiling.

* Shares of Yahoo could be in the spotlight a dayafter the company reported third-quarter earnings that wereslightly above forecasts by analyst. Yahoo shares were up 1.8percent in premarket trading.

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