On the economic front, home prices jumped 1.7 percent in April, according to the S&P/Case Shiller composite index of 20 metropolitan areas, edging past estimates for a gain of 1/2 percent, posting their biggest annual gain in seven years. And durable goods orders rose 3.6 percent in May, according to the Commerce Department, topping expectations for a 3 percent gain and after a previously reported 3.5 percent increase the prior month.
"All told, today's report is quite good with headline and core orders coming in stronger than expected," wrote Dan Greenhaus, chief global strategist at BTIG. "Most importantly, core orders which exclude defense and aircraft orders, were quite healthy in the month. Shipments are a plug into GDP estimates and so we're encouraged to see May's shipment data bounce back from weakness in April, however June needs to be strong to bring the level of shipments in the second quarter above the first quarter's level. Bottom line: good news for the economy should be good news for investors and this report is good."
Also on the economic front, new home sales numbers and the NAHB (National Association of Home Builders) house price index are also scheduled to be reported. And the Conference Board's consumer confidence report will also be closely watched. Analysts polled by Reuters forecast a reading of 75.5, down from 76.2 in May.
"With very volatile equity markets, and sluggish improvements in the labor market, the Conference Board… is likely to post a small fall, supporting other evidence suggesting that consumption growth will turn out slightly weaker in the second quarter than in the first," said Capital Economics' Amna Asaf, in a research note.
On Monday, Dallas Fed President Richard Fisher said he advocated a reduction to the central bank's stimulus program, but stressed it should be done gradually. Minneapolis Fed President Narayana Kocherlakota said markets were wrong to view the central bank as having become more hawkish on the need to tighten monetary policy and emphasized that policy will remain accommodative "for a considerable time" after the end of quantitative easing.
The Shanghai Composite halted its two-day sell-off early on Tuesday after falling sharply earlier in the session, but remained 20 percent from a ten-month high hit in February.The Chinese central bank said it expected seasonal factors that caused a recent spike in interbank market rates to gradually fade. Local lenders in China have faced a severe liquidity strain in recent weeks, with interbank lending rates hitting double digits last week, raising concern that efforts to rein in credit growth and steer the economy away from a dependence on credit-driven investment could go wrong.
The People's Bank of China has largely taken a back seat in its response to the cash crunch saying on Monday that overall liquidity was at a "reasonable" level and asking commercial banks to improve the ways they manage their liquidity and control lending. This hands-off approach has unnerved investors, sending the benchmark Shanghai Composite to its lowest levels since 2009.
Among earnings, Lennar rallied after the homebuilder posted earnings that beat expectations. Other homebuilders including Beazer, Pulte and DRHorton also rose following the news.
Barnes & Noble tumbled after the bookstore chain reported that its quarterly net loss more than doubled as sales of its Nook device and e-books continued to plunge and business at its bookstores declined.
Walgreen declined after the drugstore chain reported weaker-than-expected quarterly results, citing slow front-end sales and a challenging economy.
Apollo Group and Smith & Wesson are among notable companies slated to post earnings after the closing bell.
(Read More: Earnings Season Already Looks Like a Train Wreck)
Boeing posted orders for 232 aircraft in May, up from 51 the month before, an 85 percent seasonally adjusted month-on-month surge.
Microsoft and Oracle announced a tie-in to garner advantage against newer, web-based cloud computing companies.
Thee Treasury is expected to auction $35 billion of two-year notes, with the results available shortly after 1pm ET.