U.S. stocks rebounded Tuesday following a volatile start to the trading session that saw the Dow Jones Industrial Average briefly tumble more than 100 points amid conflicting reports that a U.S. Navy vessel was seized by the Iranian military in the Persian Gulf. Meanwhile, shares of Apple Inc. ticked higher after retreating as much as 2 percent, after billionaire investor Carl Icahn tweeted that shares of the tech giant are still "undervalued and misunderstood."

The Dow Jones Industrial Average (INDEXDJX:.DJI) climbed 48.48 points, or more than 0.27 percent, to 18,086.45. The Standard & Poor's 500 (INDEXNASDAQ:.IXIC) added 3.56 points, or 0.17 percent, to 2,112.51. The Nasdaq composite (INDEXSP:.INX) rose 8.43 points, or 0.16 percent, to 5,069.02.

Oil prices pared early gains after Iranian forces seized a cargo ship Tuesday, flagged to the Marshall Islands, a senior U.S. defense official told NBC News. The incident occurred when the Maersk Tigris was passing through the Strait of Hormuz near the Persian Gulf, a Pentagon spokesman told Reuters.

Following the reports, West Texas Intermediate crude, the benchmark for U.S. oil prices, fell 0.26 percent to $56.84 a barrel, for June 15 delivery, on the New York Mercantile Exchange. Brent crude, the benchmark for global oil prices, lost 0.02 percent to $64.82 a barrel, for June 15 delivery, on the London ICE Futures Exchange.

Shares of Dow component Apple Inc. (NASDAQ:AAPL) edged up 0.20 percent to $132.94 after billionaire investor Carl Icahn tweeted Tuesday that shares of Apple are still "undervalued and misunderstood" despite its 20 percent climb this year, and a 55 percent surge in the last 12 months. 

Apple's stock rebounded slightly after falling as much as 2 percent to $129.57 in morning trading. Shares of the tech giant soared to an all-time high in extended-hours trading a day earlier after the world's most valuable company posted quarterly profit and revenue that surpassed Wall Street's estimates, and announced it would boost its capital return program to $200 billion and will raise its dividend 11 percent.

Meanwhile, shares of Merck & Co. Inc. (NYSE:MRK) jumped nearly 5 percent Tuesday to $59.90 after the drugmaker reported stronger-than-expected quarterly earnings and revenue, helped by sales of its Januvia diabetes drug and its animal health products. However, Pfizer Inc. (NYSE:PFE) edged down 0.4 percent to $34.45 after the New York company posted a 4 percent drop in quarterly revenue and cut its full-year forecast due to a stronger U.S. dollar. 

Notable companies reporting after the closing bell Tuesday include social media giant Twitter Inc. and wearable camera manufacturer GoPro Inc. 

The Federal Reserve kicks off its two-day policy meeting Tuesday, followed by a statement from the Federal Open Market Committee on Wednesday at 2 p.m. EDT. Market professionals will look for clues to the timing of the Fed’s rate hike, which most economists anticipate will happen in late spring or early fall.

Data released Tuesday revealed U.S. consumers were less confident about the economy in April, as the Conference Board's Consumer Confidence Index rose to 95.2 in April, down from a revised reading of 101.4 in March. Separately, U.S. housing prices rose in February as the S&P/Case-Shiller's 20-City Composite gained 5 percent from a year earlier, compared with a 4.5 percent increase in January.