Futures Edge Higher as Earnings Lead Way

Wall Street was set to extend the previous session's gains at the start of trading Tuesday, with European markets mostly higher across the board and some important economic testimony coming from Capitol Hill.

Treasury Secretary Tim Geithner will testify before the Senate Finance Committee at 10 am New York time on President Obama's proposed budget, while White House advisor Paul Volcker has a date with the Senate Banking Committee this afternoon. Volcker will testify on the so called "Volcker Rule," the recent proposals to curb banking industry risk.

In early earnings news, home builder D.R. Horton surprised the market by posting a profit after analysts had forecast a loss. Though the profit was due largely to a tax credit shares jumped more than 8 percent in premarket trading.

UPS posted a profit of 75 cents a sharethat narrowly beat market estimates, sending its shares about 2 percent higher.

Dow Chemical shares fell 1.5 percent even though the company's earnings appeared to beat analyst estimateson both the top and bottom lines.

Women's clothing retailer Ann Taylor said its fourth-quarter sales and gross margins were better than expected and will enable earnings to exceed expectations. Shares rose 7.5 percent in the news.

Elsewhere, Goldman Sachs put Advanced Micro Devices on its "conviction sell list" on belief the chipmaker will continue to lose money. AMD shares fell about 4 percent premarket.

February started off on the right foot for bullish investors—and against recent history. The Dow and the S&P 500 have chalked up three consecutive February losses, and the Nasdaq hasn't had a winning February since 2003.

A better-than-expected report on manufacturing helped spark the stock market on Monday, and earnings and economic numbers are, once again, likely to be the major influences on trading Tuesday.

U.S. automakers will report their January sales figures, beginning with Ford at noon New York time. They'll be watched closely for several reasons: to see if overall sales trends have improved and to see what kind of impact Toyota's recent recall problems may have had on its sales.

The National Association of Realtors is out at 10 am with December pending home sales numbers, a measure of housing contracts signed but not yet executed. Economists predict that the number will be unchanged following a 16 percent drop in December.

Other earnings reports before the bell will come from Archer Daniels Midland and Hershey. News Corp. will report after the bell.

Google could be a stock to watch today, following a Wall Street Journal report that it's preparing to launch an online business software store.

Reuters reports that private equity firms KKR, Bain, and TPG are the finalists for Morgan Stanley's $1 billion stake inCICC, China's top investment bank.

And Dutch carmaker Spyker says it's still looking for an investor to fund a third of the $74 million in cash it's agreed to pay for GM's Saab unit.

- Written by Peter Schacknow, Senior Producer, CNBC Breaking News Desk.