Futures Gain After Huge Selloff, Fed in Focus

Futures pointed to a higher open Tuesday, indicating a comeback from the previous session's steep nosedive, as investors looked ahead to the Federal Reserve's statement later this afternoon.

Stocks sold off sharply in the previous session to log the worst day since the credit crisisin 2008 following S&P's downgrade of U.S.'s credit rating last week. The Dow plunged almost 635 points, or 5.55 percent, to finish at 10,809.85, well below the psychologically-significant 11,000 mark.

Bank of America will be closely monitored after the financial giant shed over 20 percent on Monday on fears the firm may need to raise capital to cover mortgage related losses in its Countrywide business.

Among other banks, Wells Fargo gained after FBR raised the firm to "outperform" from "market perform" and added it to their "top picks" list. Meanwhile, FBR removed PNC from the same list.

Meanwhile, Transatlantic Holdings turned down a $3.2 billion takeover bid by Warren Buffett's Berkshire Hathaway unit.

On the earnings front, Disney is scheduled to release earnings after-the-bell.

Gold prices hit a record $1,778 an ounce in its biggest three-day rally since the depths of the financial crisis in late 2008

On the economic front, productivity dropped 0.3 percent in the second quarter, according to the Labor Department, following a decline of 0.6 percent in the previous quarter. It is the first consecutive decline in productivity since the second half of 2008. The drop in productivity helped push unit labor costs up 2.2 percent.

The Fed's monetary policy setting committee's statement is scheduled for release at 2:15 pm ET. Economists have speculated the Fed could reaffirm that it will hold rates low for an extended time, and also now vow to keep its balance sheet bloated at nearly $3 trillion for a long time.

But it is unlikely the Fed will embark another quantitative easing program anytime soon.

European stocks tumbledfor another session as growing worries over the health of the global economy prompted investors to dump risky assets across the board and head for safer havens. Recent action by the ECB to buy Italian and Spanish bonds appears to have little impact in Europe.

Coming Up This Week:

TUESDAY: 3-yr note auction, FOMC mtg announcement; Earnings from Disney
WEDNESDAY: Weekly mortgage apps, wholesale trade, oil inventories, 10-yr note auction, treasury budget; Earnings from Macy's, Cisco
THURSDAY: International trade, jobless claims, 30-yr bond auction, money supply; Earnings from Kohl's, Nordstrom, Nvidia
FRIDAY: Retail sales, consumer sentiment, business inventories; Earnings from JCPenney

More From CNBC.com:

• 10 Business Fakes Made in China
• Outrageous Workplace Perks
• Biggest Businesses Run by College Dropouts