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Stock-index futures rose on Tuesday as market participants grew more hopeful Greece and its private creditors will forge a deal aimed at averting a messy default and that the EU is taking steps to solve the debt crisis at a broader level.
As of 9:04 a.m. ET, Dow Jones Industrial Average futures climbed 46 points to 12647, S&P 500 futures gained 5.8 points to 1315 and Nasdaq 100 futures rose 11 points to 2473.
The European Union summit in Brussels on Monday was widely considered reasonably successful by analysts. All of the EU member countries agreed to closer fiscal ties except for Great Britain and the Czech Republic. The purpose of the agreement, which is expected to be signed in March, is to enforce budget discipline across the bloc with the hope of staving off a repeat of the current crisis.
The EU officials also agreed to the permanent sovereign rescue fund, called the European Stability Mechanism, which is expected to come into effect in July, European Council President Herman Van Rompuy said in a press conference following the summit. The fund's firepower, which has been the subject of much speculation, remains at 500 billion euro, although Van Rompuy said during the conference that this will be reassessed down the line.
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"This represents a small step towards closer fiscal integration and stronger governance in the euro area and will hopefully set the stage for a significant expansion of the [European Central Bank's] balance sheet to prevent a potential break-up of the monetary union," analysts at Nomura wrote in a note to clients on Tuesday.
Still, other analysts who closely watch the situation in Europe struck a considerably more cautious tone: The fiscal pact may help to "prevent the next crisis, but really does nothing for the current one," Louise Cooper, a markets analyst at BGC Partners said in an interview with FOX Business.
In Athens, Greece and private bondholders continued negotiating a debt swap deal aimed at staving off a messy default. The country's Prime Minister Lucas Papademos said earlier "significant progress" was made and that he expects a deal by the end of the week, according to a report from Reuters.
The euro rose 0.38% to $1.3194, while the U.S. dollar fell 0.38% against six world currencies that are tracked by the dollar index.
On the U.S. front, several big-name countries report earnings on Tuesday.
ExxonMobil (XOM) revealed fourth-quarter profits of $1.97 per share on $121.61 billion in revenue. Wall Street expected the biggest U.S. oil company to earn $1.96 per share on $119.7 billion.
Pfizer (PFE) unveiled adjusted fourth-quarter earnings of 50 cents per share on revenue of $16.7 billion. Analysts were expecting the pharmaceutical giant to earn 47 cents per share on $16.61 billion.
United Parcel Service (UPS) posted adjusted fourth-quarter profits of $1.28 per share, beating analysts’ forecasts by two cents. The shipping company, seen as a bellwether of the economy, said its sales came in at $14.2 billion for the quarter, shy of estimates of $14.46 billion.
Amazon.com (AMZN) posts its earnings after the closing bell.
The S&P/Case-Shiller composite index of 20 metropolitan areas shows home prices fell 1.3% on a non-seasonally adjusted basis, a bigger drop than the 0.8% decline economists had expected. Home prices are down 3.7% from a year ago, more than the 3.3% economists had expected.
Commodities markets were broadly to the upside as equities rose and the dollar weakened. The benchmark crude oil contract traded in New York gained $1.49, or 1.5%, to $100.20. Wholesale RBOB gasoline climbed 0.5% to $2.885.
In metals, gold jumped $8.10, or 0.47%, to $1742.50 a troy ounce.
European blue chips rallied 1.1%, the English FTSE 100 gained 0.92% to 5,724 and the German DAX jumped 1% to 6,509.
In Asia, the Japanese Nikkei 225 edged 0.11% higher to 8,803 and the Chinese Hang Seng tacked on 1.1% to 20,391.