Stock index futures rose on Tuesday, indicating the S&P 500 may snap a two-day drop, as investors focus on a slew of corporate earnings and Spanish bond yields dip.

A better-than-expected Spanish bill sale boosted confidence before a longer-term debt auction later in the week. Spanish debt yields have jumped recently on concerns about the nation's fiscal stability in the latest flare-up of the euro-zone debt crisis.

European stocks gained after the auction and better-than-expected consumer sentiment data from Germany. The FTSEurofirst 300 index of leading pan-European shares gained 1.1 percent. <.EU>

Earnings season heats up this week, with 86 S&P 500 companies scheduled to report results. According to Thomson Reuters data, of the 34 companies in the S&P 500 that have reported results through Monday, 76 percent have reported earnings above analyst expectations.

Goldman Sachs Group Inc reports first-quarter results on Tuesday, and Wall Street forecasts earnings per share of $3.55, up from $1.56 per share year earlier, bolstered by write-ups of stocks and bonds in Goldman's investment portfolio and market-making book.

Coca-Cola Co , the world's largest soft drink maker, is expected to report quarterly earnings of 87 cents per share.

Yahoo Inc is also due to unveil earnings, but the report may be overshadowed by comments from its new chief executive, Scott Thompson, who is expected to lay out his vision for the struggling web pioneer.

Johnson & Johnson is forecast to report flat first-quarter earnings per share of $1.35, as recovering sales growth of prescription drugs is offset by anemic sales of hip implants and consumer medicines that have been subject to costly and embarrassing recalls.

International Business Machines Corp reports earnings after the bell on Tuesday, and investors are hoping strong software demand will make for a repeat of last year's first-quarter performance, when the company raised its full year forecast.

A unit of Toshiba Corp <6502.T> is in talks to buy IBM Corp's point-of-sale terminal business, which includes cash registers, a source familiar with the deal said on Tuesday.

S&P 500 futures rose 7.8 points and were above fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures gained 60 points, and Nasdaq 100 futures added 12.5 points.

Economic data expected Tuesday include housing starts and permits for March from the Commerce Department at 8:30 a.m. EDT (1230 GMT). Economists in a Reuters survey forecast a 705,000 annualized rate in March versus 698,000 in February, and a total of 710,000 permits in March compared with 715,000 in the prior month.

At 9:15 a.m. EDT (1315 GMT), the Federal Reserve releases industrial production and capacity utilization data for March. Economists in a Reuters survey expect a 0.3 percent rise in production and a reading of 78.6 percent for capacity utilization. In the previous report, production was flat and capacity utilization was 78.4 percent.

Apple Inc shares were flat at $580 in premarket trading. Shares of the iPad maker have fallen in five straight session, the longest losing streak for the stock since September.

Asian shares fell as surging Spanish borrowing costs underscored the fading impact of the European Central Bank's bond purchases and stoked investor nervousness over euro zone debt woes, sapping their risk appetite.

(Editing by Padraic Cassidy)

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