U.S. Stock Futures Turn Higher

Updated from 6:48 a.m. EST

Premarket futures had earlier been forecasting a downbeat open for Wall Street Tuesday but lately were reflecting a more optimistic view, after the Federal Reserve announced a $600 billion program to aid government-backed mortgage firms and a $200 billion program to aid consumers hurt by the credit crisis.

Futures for the S&P 500 were adding 21 points at 869 and were trading 19 points above fair value. Nasdaq futures were higher by 24 points at 1171, 16 points ahead of fair value.

Futures had earlier suggested that investors would be taking profits from the previous two sessions' impressive gains. However, following the Fed's announcement that it would buy direct obligations and mortgage-backed securities tied to the Federal Home Loan Banks and Fannie Mae (FNM), Freddie Mac (FRE) and Ginnie Mae, premarket trading took a more bullish tone.

The Fed also announced the creation of a $200 billion facility for holders of triple-A rated asset-backed securities tied to loans related to education, autos, credit cards and small businesses.

On Monday, stocks rallied sharply on news of a government bailout for Citigroup (C), whose subprime exposure and off-balance-sheet assets had left investors uncertain about its future. The government's guarantee of more than $300 billion in Citi debt and $20 billion equity investment in the firm sent the company's shares, along with the major indices, rocketing higher.

Ahead of the new day's trading, other financial firms were looking to get government help of a different sort. Goldman Sachs (GS) garnered strong interest in a government-backed issuance of $2 billion to $3 billion in bonds, according to a report by The Wall Street Journal. The sale is expected to conclude Tuesday, and Citi and General Electric (GE) are expected to stage similar government-assisted bond sales.