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NEW YORK (CNNMoney) -- U.S. stocks were set to rebound Tuesday, as investors react to strong reports on the housing market and digest the latest batch of corporate earnings.
Dow Jones industrial average (INDU), S&P 500 (SPX) and Nasdaq (COMP) futures were higher ahead of the opening bell. Futures measure current index values against perceived future performance.
Stocks began the week sharply lower, selling off nearly 1% on Monday, as worries about Europe's debt crisis and uncertainty over the U.S. debt ceiling continued to hang over the market. Meanwhile, gold prices surged.
The failure of eight banks to pass Europe's latest round of bank stress tests, coupled with the ongoing struggle to find a solution for Greece's debt crisis, have done little to restore investor confidence overseas.
And lawmakers at home have made little progress on a deal to raise the debt ceiling. There are now only two weeks before the Aug. 2 deadline to raise the country's legal borrowing limit.
Philip Isherwood, equities strategist at Evolution Securities, said there are just enough bright spots in corporate results to distract investors -- however briefly -- from the European sovereign debt crisis and political brinkmanship in the United States.
"Some of the results have been coming out well," Isherwood said. "It's just a question of how long you can carry on thinking about that."
Economy: Before the opening bell, the Commerce Department reporting stronger-than-expected numbers of June housing starts and building permits, giving the markets an extra boost.
The government reported an annual rate of 629,000 housing starts and 624,000 housing permits for June.
Economists polled by Briefing.com had forecast that housing starts would rise to an annual rate of 570,000 units in June, while permits were expected to remain unchanged at 609,000 units.
Companies: Quarterly reports from the banking sector will take center stage Tuesday morning.
Before the opening bell, Bank of America (BAC, Fortune 500) reported a net loss of $8.8 billion, or 90 cents per diluted share, in line with analyst expectations.
The bank was not expected to report a profit after agreeing to pay an $8.5 billion settlement to investors burned by fraudulent mortgage securities.
Goldman Sachs (GS, Fortune 500) posted second-quarter earnings of $1.1 billion profit, or $1.85 a share -- missing analysts' forecasts. The investment firm reported net revenue of $7.28 billion.
Citing strong demand, Coca-Cola (KO, Fortune 500) reported earnings per share of $1.20 on revenue of $12.7 billion, beating analyst expectations. Shares of the soft-drink maker were up more than 1% in premarket trading.
Investors will also hear from Dow component Johnson & Johnson (JNJ, Fortune 500) before the market open.
Apple (AAPL, Fortune 500) is scheduled to report its earnings after the closing bell. The iPod, iPad and Mac computer maker is forecast to have earned $5.85 a share. Also out after the close on Tuesday are results from Yahoo! (YHOO, Fortune 500).
Cisco (CSCO, Fortune 500) announced plans late Monday to lay off 9% of its work force, and to transfer another 7% of its staff to another company in a sale of one of its businesses. Shares of Cisco rose about 1% in premarket trading.
IBM said Monday its profit for the quarter rose 8% from last year to $3.7 billion. Excluding one-time charges, earnings per share were $3.09. The positive news had IBM (IBM, Fortune 500) shares up almost 2% in premarket trading.
World markets: European stocks were higher in morning trading. Britain's FTSE 100 edged higher 0.5%, the DAX in Germany advanced 1.5% and France's CAC 40 added 1.3%.
Asian markets ended mixed. The Shanghai Composite was off 0.7% and Japan's Nikkei lost 0.9%, while the Hang Seng in Hong Kong ticked up 0.5%.
Currencies and commodities: The dollar weakened against the euro, the Japanese yen and British pound.
Gold futures for August delivery hit an intraday record of $1,610.70 an ounce, before retreating to $1,605.60 -- a gain of $3.20 an ounce.
Oil for August delivery gained 80 cents to $96.73 a barrel.
Bonds: The price on the benchmark 10-year U.S. Treasury dropped, pushing the yield up to 2.96% from 2.91% late Monday. 
| Index | Last | Change | % Change |
|---|---|---|---|
| Dow | 32,627.97 | -234.33 | -0.71% |
| Nasdaq | 13,215.24 | 99.07 | 0.76% |
| S&P 500 | 3,913.10 | -2.36 | -0.06% |
| Treasuries | 1.73 | 0.00 | 0.12% |
| Company | Price | Change | % Change |
|---|---|---|---|
| Ford Motor Co | 8.29 | 0.05 | 0.61% |
| Advanced Micro Devic... | 54.59 | 0.70 | 1.30% |
| Cisco Systems Inc | 47.49 | -2.44 | -4.89% |
| General Electric Co | 13.00 | -0.16 | -1.22% |
| Kraft Heinz Co | 27.84 | -2.20 | -7.32% |
| Overnight Avg Rate | Latest | Change | Last Week |
|---|---|---|---|
| 30 yr fixed | 3.80% | 3.88% | |
| 15 yr fixed | 3.20% | 3.23% | |
| 5/1 ARM | 3.84% | 3.88% | |
| 30 yr refi | 3.82% | 3.93% | |
| 15 yr refi | 3.20% | 3.23% |
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