Stocks were set to open higher on Tuesday as Chinese data fueled the belief the government may move to stimulate growth, overshadowing recent credit downgrades in Europe and a mixed bag of bank earnings.
China's economy grew slightly more than expected but at the weakest pace in 2-1/2 years, suggesting the government may try to boost growth in the near term by tweaking monetary policy.
Expectations are always a little irrational when it comes to China because of the track record we've seen. It's definitely supportive (for the market) and the fact of the matter is they are still the engine of growth, said Peter Kenny, managing director at Knight Capital in Jersey City, New Jersey.
Citigroup was off 3.3 percent to $29.72 in premarket trade after its quarterly earnings missed expectations, while Wells Fargo advanced 1.3 percent to $29.99 after its profit topped estimates by a penny.
Investors appeared set to shrug off a cut in the credit rating of the euro zone's rescue fund by Standard & Poor's by one notch, apparently relieved the downgrade was not more severe. The move comes after Friday's widely expected downgrade of a number of euro zone countries.
It was just a question of when it was going to happen so it wasn't a surprise, it wasn't unexpected and that would explain why it was not disruptive, said Kenny.
S&P 500 futures rose 8.9 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 climbed 79 points, and Nasdaq 100 futures added 18 points.
A gauge of manufacturing in New York State showed growth picked up in January, rising to the highest level in nine months, keeping in line with the trend of modest improvement in U.S. economic data.
Carnival Corp slumped 15.9 percent to $28.82 in premarket trade after its Italian unit, Costa Crociere, attempted to locate missing passengers after its cruise liner capsized. Fellow cruise operator Royal Caribbean Cruises Ltd lost 7.3 percent to $26.60.
France's EDF SA agreed to drop its opposition to power group Exelon Corp's purchase of Constellation Energy Group Inc after reaching a deal to protect the operating independence of a nuclear joint venture with Constellation. Exelon rose 1.4 percent to $40.30 in premarket.
AIA Group Ltd <1299.HK>, Asia's No. 3 insurer that is about one-third owned by American International Group Inc , may bid for the $6 billion Asian insurance operations of ING Groep , sources said.
(Reporting By Chuck Mikolajczak; editing by Jeffrey Benkoe)