Stock index futures pointed to a higher open on Wall Street on Monday, as stocks bounced back from last week's steep losses on easing worries that Washington would have to nationalize embattled banks.

At 0927 GMT (4:27 a.m. EST), futures for the S&P 500 were up 1.6 percent, Dow Jones futures were up 1.5 percent and Nasdaq 100 futures were up 1.8 percent.

Citigroup is in talks that could lead to the U.S. government sharply increasing its stake, turning what was once U.S.'s most valuable bank into a virtual ward of the state and a symbol of the raging global financial crisis.

The Wall Street Journal said the government, by converting a big chunk of the $45 billion of preferred shares it bought last year in an attempt to stabilize Citigroup, could end up owning as much as 40 percent of the bank's common equity.

Shares of Citigroup traded in Frankfurt were up 28 percent.

Outside advisers to the U.S. Treasury are lining up contingency financing options for General Motors Corp and Chrysler LLC as part of a review of restructuring options for the auto makers, a Treasury official said on Monday.

Toyota Motor Co <7203.T> plans to cut parent-only global automobile production by 20 percent in 2009 to 6.5 million units as demand plunges, the Nikkei business daily said on Monday.

No major macroeconomic data was expected on Monday, while on the earnings front, investors awaited results from Campbell Soup , Developers Diversified Realty Co. , DTE Energy Co. and Nordstrom .

U.S. stocks dropped on Friday, with the Dow industrials ending at a 6-1/2-year low, on fears the government may be forced to nationalize some big banks. The Dow Jones industrial average <.DJI> fell 100.28 points, or 1.34 percent, to close at 7,365.67. The Standard & Poor's 500 Index <.SPX> ended down 8.89 points, or 1.14 percent, at 770.05. The Nasdaq Composite Index <.IXIC> dipped 1.59 points, or 0.11 percent, to 1,441.23.

(Reporting by Blaise Robinson; Editing by Sharon Lindores)