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Futures tick higher as traders eye Fed decision

U.S. stock-index futures signaled a higher opening on Tuesday ahead of the first day of a two-day meeting of the Federal Open Market Committee (FOMC). Investors are waiting to see when and whether the U.S. Federal Reserve will announce a scaling back of its $85 billion monthly bond-buying program, with an announcement expected on Wednesday.

On Monday, stocks surged, with the Dow and the S&P 500 bouncing back from two consecutive weekly declines.

Stock futures added to their gains after data had the cost of consumer goodsholding unchanged in November, while costs excluding food and energy rose 0.2 percent.

While Asian equities followed on from the U.S. rally on Monday, European equities were lower in trade on Tuesday as investors grew jittery ahead of the Fed's last policy meeting of the year.

The macroeconomic picture of Fed "tapering" continues to plague investor sentiment with the extra liquidity provided by the central bank seen as a key driver behind this year's rally. Many analysts argue that stronger economic data in recent weeks, including employment and consumer confidence, argue in favor of a reduction of its monthly bond purchases.

Deutsche Bank wrote in a morning note that it expected tapering to indeed begin after the two-day meeting, although Jim Reid wrote, "The consensus still seems to be in favor of January or March for the first taper so markets are not fully set up for a move although a dovish statement would help. We continue to think that the Fed will find it more difficult to remove the full $85 billion in 2014 than they and the market think. Much depends on how markets/economies react when the Fed starts."

Elsewhere in Europe, German Chancellor Angela Merkel was sworn into office, alongside a 16-member cabinet, in a new coalition with the SPD.

AMC Entertainment Holdings's (AMC) launches an initial public offering (IPO) on Tuesday, with the company aiming to raise as much as $368 million in the sale, offering 18.4 million shares for $18 to $20 each. With 343 theaters and a whopping 4,950 screens, AMC is the second largest movie theater operator in the United States.

—By CNBC's Kiran Moodley

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