Futures pared gains Wednesday after the first look at first-quarter GDP showed the economy contracted at a sharper pace than expected.
The government's first read on first-quarter gross domestic product showed the economy contracted at a 6.1 percent pace, much sharper than the 4.9 percent economists had expected, amid declines in exports and business inventories. The economy contracted at a 6.3 percent rate in the fourth quarter.
But futures continued to point higher as stronger-than-expected consumer confidence data and home prices on Tuesday improved sentiment and eclipsed fears of a swine flu pandemic.
In addition to the prior session's economic data, positive earnings reports added to good feelings on Wall Street, which was poised for gains of less than 1 percent off the opening bell.
Qwest Communications posted a quarterly profit that beat analyst estimates even as revenue fell 7 percent as customers disconnected their phones amid concerns about the economy.
Qwest's profit rose to $206 million, or 12 cents per share from $150 million, or 8 cents per share in the same quarter a year ago. Analysts were expecting a repeat performance of 8 cents.
The beat sent Qwest shares nearly 8 percent higher in premarket trading.
Elsewhere, Wyeth narrowly beat analyst expectations, posting a profit of 89 cents per share, but revenue fell below estimates as a strong dollar hurt overseas sales.
And ArcelorMittal , the world's largest steelmarket, saw its shares fall more than 5.5 percent premarket after the company's earnings disappointed amid lackluster demand due to the global economic downturn.
In the financial sector, Citigroup shares gained nearly 6 percent after the bank asked for government permission to pay bonuses for certain employees and is looking to free its energy-trading unit from government restrictions.
Asian and European markets were higher on Wednesday, as were oil prices, ending two days of declines.
The Federal Reserve ends a two-day meeting on Wednesday and as rates have remained at a record low since December, the focus will be on any extension of quantitative easing and the central bank's economic outlook. A statement is due out at 2:15 pm New York time.
"In terms of delivering what market participants are looking for … they (Fed) don't need to come up with any blockbuster initiatives like they did in March," Stephen Gallo, head of market analysis at Schneider Foreign Exchange told CNBC.
Wednesday also marks President Barack Obama's first 100 days in office. A NBC poll showed most of the American public was pleased with the progress the president has made.
In corporate news, Bank of America CEO Kenneth Lewis may be forced to give up his role as chairman but is set to win re-election to the bank's board by a wide margin, the Wall Street Journal reported, citing people familiar with the preliminary results of shareholder votes ahead of the bank's annual meeting on Wednesday.
The Journal also reported that Citigroup has asked the U.S. Treasury for permission to pay special bonuses. According to the paper, Citi executives are describing these as retention bonuses, but the bank is still considering several options of how to structure any bonuses.
The Financial Times reported that American International Group persuaded a senior executive at its troubled financial products department to rescind his resignation to help avoid default on $234 billion in derivatives.
And late Tuesday, U.S. government officials said they had reached a breakthrough framework deal with Chrysler to cut the automakers' debt by $6.9 billion.
Time Warnerbeat analysts' forecasts for its first-quarter profit and revenue results and reaffirmed its full-year guidance. The media group posted earnings of 45 cents a share, excluding certain items, which was ahead of forecasts from analysts polled by Thomson Reuters. Shares gained 2.4 percent in light premarket trading.
While Visa and Starbucks are to announce first-quarter earnings after the closing bell, and are seen posting 64 cents and 15 cents per share, respectively.