Investors are treading cautiously as they wait to see whether the Federal Reserve will begin cutting back on its massive stimulus program -- which has supported stock markets around the world -- as economic data continue to improve.
"[A] growing minority now believe that the Federal Reserve could start to taper at this week's meeting," said Kathleen Brooks, a research director at Forex.com. "Only a few weeks ago this was virtually unheard of, with most traders and investors looking at late Q1-Q2 2014 for the Fed to start tapering."
The Fed has been pumping $85 billion per month into the financial system since September 2012. It will announce any policy changes after it wraps up its two-day meeting Wednesday afternoon.
In corporate news, Google(GOOG) agreed to buy military robot maker Boston Dynamics, a builder of military robots.
Shares of Sprint(S) rose in premarket trading following reports from The Wall Street Journal that it was working on a deal to acquire T-Mobile(TMUS).
AIG(AIG) reached an agreement to sell its airline leasing business to AerCap Holdings(AER) for $5.4 billion.
On the economic data front, the New York branch of the Federal Reserve is set to release its monthly manufacturing survey at 8:30 a.m. ET Monday, while the Labor Department will release its revised estimate of third quarter productivity.
At 9:15 a.m. ET, the Census Bureau will publish its monthly reports on industrial production and capacity utilization.