* Payrolls data expected to give the market direction
* Fed's Bernanke testifies before Congress
* Futures: Dow up 7 pts, S&P off 0.1 pt, Nasdaq off 4 pts
NEW YORK, Jan 7 (Reuters) - U.S. stock index futures were little changed on Friday as investors waited to see if U.S. non-farm payroll figures were as strong as previous data seemed to indicate.
* Economists expect the government payrolls data, due at 8:30 a.m. EST (1330 GMT), to show the U.S. economy created 175,000 new jobs in December, the highest level since May. For details see
* Some economists revised their forecasts higher after Wednesday's surprising ADP private-sector employment figures, which were triple forecasts.
* Overbought levels on the S&P 500 opened the door to the possibility of steep declines if payrolls disappoint. Short-term technical support for the benchmark was found near 1,260, its 14-day moving average. The S&P closed at 1,273.85 on Thursday.
* The key jobs data report will come after a 7.9 percent rise in the S&P 500 from the start of December to date.
* S&P 500 futures dipped 0.1 point and fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract, was unchanged. Dow Jones industrial average futures were up 7 points, and Nasdaq 100 futures fell 4 points.
* Facing a newly empowered Republican Party skeptical of the Federal Reserve's attempt to stimulate the U.S. economy, chairman Ben Bernanke may douse some of Wall Street's optimism as he delivers congressional testimony at 9:30 a.m. EST (1430 GMT).
* The Pentagon has overhauled the Lockheed Martin Corp F-35 fighter project for the second time in a year and will buy 41 Boeing Co F/A-18 combat planes over the next three years to offset slower Lockheed production.
* The board of bailed-out insurer American International Group Inc approved a dividend that assumes its recapitalization plan will close as soon as next week.
* Sara Lee Corp is considering spinning off its meat and coffee businesses after rejecting a takeover bid from Brazil's JBS SA, a source said.
* U.S. stocks were mostly lower Thursday as soft retail sales and a sharp rise in the dollar sent both the Dow industrials and S&P 500 down 0.2 percent. But the Nasdaq Composite rose 0.3 percent.