Futures turn higher

NEW YORK (CNNMoney.com) -- A surprisingly strong report on home construction activity gave investors something to cheer about Tuesday as Wall Street also remains on watch for the latest statement from the Federal Reserve.

Stock futures turned higher following the housing starts report, indicating a gain for stocks at the start of trading on Wall Street.

Housing starts rebounded from a nine-year low in February, according to the latest government reading on the battered homebuilding industry, but at the same time continued weakness led builders to pull back on plans for more housing.

Starts of new homes jumped to an annual rate of 1.53 million in the month from the revised 1.4 million pace in January, which had been a nine-year low. Economists surveyed by Briefing.com had forecast that starts would rebound to a 1.45 million annual pace.

Building permits, seen as a measure of builder's confidence in the market, fell to an annual rate of 1.53 million from the 1.57 million pace in January. Economists had forecast that permits would slip to only a 1.55 million rate.

A survey of builder confidence by the National Association of Home Builders released Monday showed confidence fell in March for the first time since September.

Meanwhile, the Fed starts a two-day meeting Tuesday with economists and investors expecting the central bank to leave interest rates unchanged. But there's been growing hope on Wall Street that problems in housing and the subprime mortgage sector could lead the Fed to signal in its statement that it is open to a rate cut in the future.

Stocks in Asia closed mostly higher, with Taiwan being the only major index there to lose ground. Stocks in Europe were mostly lower in early trading.

Oil prices edged up in early trading. U.S. light crude gained 22 cents to $56.81 a barrel in electronic trading.

Treasury prices edged higher. The yield on the U.S. 10-year note climbed to 4.57 percent from 4.56 late Monday. Bond prices and yields move in opposite directions.

The dollar rose versus the euro and the yen.

In corporate news, tech bellwether Oracle (Charts) is due to report results after the closing bell Tuesday. Analysts are forecasting earnings to be up 19 percent and revenue up 23 percent.

Some investment banks could get a lift after a federal appeals court in New Orleans late Monday threw out a class-action suit by Enron Corp. investors seeking $40 billion from firms such as Merrill Lynch (Charts) and Credit Suisse Group (Charts). Merrill shares gained 0.3 percent in after-hours trading, but shares of the Swiss investment bank were narrowly lower in Zurich trading Tuesday.

The Wall Street Journal reported Tuesday that Apple (Charts) is making gains in sales of the Macintosh personal computers to the professional market, helped by its inclusion of an Intel (Charts) computer chip that allows it to run Microsoft's (Charts) Windows operating system.

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