Stock index futures pointed to a higher open on Tuesday, with sentiment improving on signs of progress in dealing with Europe's long-running sovereign debt crisis.

Key earnings also drove trading, with shares of Exxon falling and Eli Lilly and U.S. Steel advancing. The results reflected a mixed picture of corporate strength, continuing a trend this earning season.

Hopes built that Greece was nearing a debt swap deal, just a day after talks had stalled, lessening the odds of a messy default and possibly creating other shocks to the region's financial system.

Also boosting the market, European Union leaders agreed on a stricter budget discipline plan to prevent further debt build-up in the region.

Since December, Wall Street has largely decoupled from European equities, trading less in tandem with the region than in the months before. Investors still looked to developments from the region for any setbacks or signs of progress.

Europe seems to be closer to a resolution, and while they're not done with their issues, any good news will be taken positively, said Rick Bensigor, chief market strategist at Merlin Securities in New York. Any sellers at this stage will be tactical, and they're likely to get squeezed here.

The pan-European FTSEurofirst 300 <.FTEU3> index of top shares rose 1.1 percent, putting European equities on track for their best month since October. <.EU>

S&P 500 futures rose 6.6 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 added 46 points, and Nasdaq 100 futures gained 12 points.

The S&P is up 4.4 percent in January, its best month since October, heading into the last trading day of the month. The Dow is up 3.6 percent and has had three straight months of gains. The Nasdaq is up almost 8 percent on strong results from technology companies.

Quarterly profits from drugmakers Pfizer Inc

and Eli Lilly & Co both topped expectations. But Pfizer trimmed its 2012 view and Lilly repeated an outlook calling for a drop in 2012 earnings. Lilly was up 2.8 percent $40.35.

RadioShack Corp slumped 32 percent to $6.95 a day after warning of a drop in fourth-quarter profit.

A number of other major companies reported results, including Exxon Mobil Corp , U.S. Steel Corp and United Parcel Service Inc .

Exxon shares lost 1.4 percent to $84.31 before the bell while U.S. Steel gained 2.9 percent to $29.55 and UPS rose 0.9 percent to $75.50.

U.S. single-family home prices fell more than expected in November, according to the S&P/Case-Shiller composite index, highlighting a sector that continues to struggle to make a meaningful recovery. Futures moved little after the data.

Consumer confidence for January, due at 10 a.m. EST (1500 GMT), is seen rising to 68 from 64.5 in December, while the Chicago Purchasing Manager's Index, also for January, is seen rising to 63 from 62.2 in the previous month. Chicago PMI is expected at 9:45 a.m. EST (1445 GMT).

U.S. stocks fell for much of Monday's session, but an afternoon rally cut losses in a sign of the underlying resilience the market has shown early in the year. The S&P held above the psychologically important 1,300 level after crossing it for the first time in six months earlier in January.

(Reporting by Ryan Vlastelica; editing by Jeffrey Benkoe)