Stock Futures Rise After Housing Data

NEW YORK (TheStreet) -- Stock futures inched higher Tuesday amid hopes for more stimulus from the Federal Reserve and more signs of a stabilizing housing market.

Futures for the Dow Jones Industrial Average were up 30 points, or 48.2 points above fair value, at 12,716. Futures for the S&P 500 were up 3.7 points, or 6.3 points above fair value, at 1344, and futures for the Nasdaq 100 were up 10 points, or 10.8 points above fair value, at 2598.

Stocks finished on a mixed note Monday as the pro-bailout party's victory in Greece over the weekend provided only a fleeting dose of relief to the eurozone debt crisis. The election results quelled immediate concerns about Greece being on a path to leave the single-currency bloc but news of rising borrowing costs for Spain kept a lid on investor enthusiasm over the outcome.

Eurozone members of the Group of 20 major economies are expected to declare Tuesday their commitment to "take all necessary policy measures" to ensure that the euro stays intact and to bolster confidence, according to reports of a draft communiqué from the G20 summit in Mexico.

The two-day Federal Reserve meeting begins Tuesday and analysts say there is the possibility of some kind of stimulus, mostly likely with the extension of Operation Twist.

"Our long-held view, initiated last October, is that the Fed will launch QE3 by early fall," said Michael Hanson, senior U.S. economist at Bank of America. "That remains our view today. We also now think that the Fed will not start hiking interest rates until mid-2015 at the earliest."

"We see roughly a 1-in-3 chance of a significant policy easing at the June FOMC meeting."

He thinks the Fed statement on Wednesday after its meeting will be "quite dovish" and would not be surprised to see stronger language around policy; "perhaps replacing 'stands ready' to adjust its balance sheet for the 'is prepared' that it has used since June 2011."

When the updated projections are released, Hanson expects downward revisions to the Fed's above-consensus gross domestic product growth forecasts and a wider range of views as "the doves" raise their unemployment rate projections and lower their inflation expectations.