US STOCKS-Wall St set to open lower after two-day rally

* July consumer spending picks up slightly

* Major U.S (Other OTC: UBGXF - news) . indexes set to end the week higher

* Freeport-McMoran jumps after Icahn discloses stake

* Futures down: Dow 101 pts, S&P 12 pts, Nasdaq 24 pts (Adds details, comment, updates prices)

By Tanya Agrawal

Aug 28 (Reuters) - U.S. stocks were set to open lower on Friday, following a two-day market rally, as investors took a breather heading into the weekend after a hair-raising ride for global markets in the past few days.

Wall Street logged its biggest two-day gain since the financial crisis on Thursday on strong U.S. economic data and hints that a September interest-rate hike was unlikely.

The three major U.S. indexes looked set to end the week higher despite the market's cumulative 10 percent drop in the first two days of the week amid fears of a slowdown in China.

"A lot of investors are looking for markets to calm down and are rebalancing their portfolios before going into the weekend," said Jeff Carbone, co-founder and managing partner of Cornerstone Financial Partners.

Carbone said investors were taking a wait-and-see approach before making big decisions.

The recent turmoil has led to strategists cutting their end-of-year market forecasts. Data for August 20-26 showed a record $28 billion in outflows from equity funds.

Chinese stocks jumped more than 4 percent for the second day as authorities announced that pension funds managed by China's local governments will start investing 2 trillion yuan ($313 billion) as soon as possible in stocks and other assets.

S&P 500 e-minis were down 11.75 points, or 0.59 percent, with 306,543 contracts traded at 8:46 a.m. ET (1246 GMT).

Nasdaq 100 e-minis were down 24 points, or 0.55 percent, on volume of 44,308 contracts.

Dow e-minis were down 101 points, or 0.61 percent, with 35,634 contracts changing hands.

Data released on Friday showed U.S. consumer spending picked up a bit in July as households bought more automobiles, offering further evidence of strength in the economy.

The University of Michigan's final August reading of consumer sentiment index, scheduled to be released at 10 a.m. ET, is expected to come in at 93.0, higher than its preliminary reading of 92.9 earlier in the month.

Global stock market volatility has raised doubts over when the Fed will raise rates, particularly after New York Fed chairman William Dudley said on Wednesday the case for a September hike appeared less compelling.

Despite the stronger-than-expected data released earlier this week, traders gave a one-in-four chance that the Fed would increase interest rates in September.

The Fed has said it will raise interest rates only when it sees a sustained recovery in the economy. While the labor market has continued to gain strength, inflation remains below the Fed's 2 percent target.

"We don't think the Fed will raise rates this year. While the data has been improving, it doesn't show an over-heated economy, inflation remains low and we need to see the effect of low energy prices," said Carbone.

Freeport-McMoran shares jumped 15.6 percent to $11.78 in premarket trading after activist investor Carl Icahn disclosed an 8.5 percent stake in the company.

Autodesk (NasdaqGS: ADSK - news) was down 4 percent at $48 after the maker of computer-aided design software cut its full-year profit and revenue forecast for the second time this year.

Big Lots (NYSE: BIG - news) was up 10.4 percent to $46.30 after its second-quarter profit beat expectations and the company raised its full-year adjusted profit forecast. (Reporting by Tanya Agrawal; Editing by Saumyadeb Chakrabarty)