U.S. stock index futures rose on Wednesday, following a steep sell-off in the previous session, as investors awaited the Federal Reserve's interest rate decision and a statement on the economy.

The Fed is expected to hold interest rates near zero and repeat its vow of an extended period of very low rates as the Federal Reserve Open Market Committee concludes a two-day policy meeting. The statement is expected at around 2:15 p.m. EDT.

Tuesday's sharp drop, including a 2 percent drop in the S&P 500, was triggered by downgrades in Greece and Portugal credit ratings and after a U.S. Senate subcommittee grilled Goldman Sachs executives on the bank's role in the financial meltdown, heightening the possibility of financial reform.

If the Fed says something out of the band of expectation, given yesterday's behavior, we could be in store for greater volatility, said Andre Bakhos, director of market analytics at Lek Securities in New York.

Earnings season continued, with Dow Chemical Co reporting a profit that beat expectations. The stock rose 1.4 percent to $30.50 in light premarket trading.

WellPoint Inc and Corning Inc both posted better-than-expected results.

Sprint Nextel Corp sank 6 percent to $3.85 before the bell after it recorded a wider loss, but met expectations, excluding charges.

As important as earnings are, it appears that for the moment they will be taking a backseat to the drama unfolding in Greece and with financial regulation, Bakhos said.

S&P 500 futures were up 5.2 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 rose 39 points, while Nasdaq 100 futures gained 8.5 points.

Nasdaq futures were helped by Broadcom Corp a day after the company swung to a first-quarter profit that beat expectations and gave a second-quarter outlook above the consensus estimate.

U.S. Senate Republicans offered counterproposals on financial regulation reform on Tuesday in a bid to water down portions of a massive Democratic bill. [nN27117703]

In Europe, investors continued to reel from the Greece and Portugal downgrades, with European stocks falling 0.7 percent Wednesday morning after a 3.1 percent sell-off the day before.

In Tokyo, Japan's Nikkei average slid 2.6 percent, dragged down by exporters such as Kyocera <6971.T> that were hurt by fears that euro zone debt problems could spread. <.T>

Investors also digested Chinese state media reports that the country would place a moratorium on capital raising by real estate firms as part of a broader campaign to rein in property price rises.

(Editing by Jeffrey Benkoe)