U.S. stock index futures edged higher Tuesday, steadying after Wall Street's first pullback in more than a week, as investors braced for a fresh inflation reading that could help offer clues to the Federal Reserve's upcoming policy decisions.

Geopolitical developments were also in focus as special envoy Steve Witkoff and U.S. President Donald Trump's son-in-law Jared Kushner are expected to meet Russian President Vladimir Putin for talks on a possible way to end the war in Ukraine.

U.S. stocks kicked off December on a dour note, with the three main indexes marking their first daily losses in more than one week on Monday, pressured by a tick-up in Treasury yields and a selloff in crypto stocks.

Investor attention is now focused on Friday's release of the Personal Consumption Expenditures (PCE) Index data from the U.S. Bureau of Economic Analysis, the Fed's preferred gauge of inflation.

Recent data pointing to a gradually cooling economy has reinforced bets on a Federal Reserve rate cut at next week's meeting.

Markets remained steady as investors digested robust online holiday spending of $23.6 billion, surpassing analyst forecasts, Adobe Analytics reported.

The unexpected contraction in U.S. manufacturing activity in November supports the case for the Fed to cut interest rates in December, said Elias Haddad, global head of markets strategy at Brown Brothers Harriman.

Policymakers are largely divided on monetary policy, but dovish signals from a few key voting members in recent weeks have had traders pricing in an 87.2% chance for a 25-basis-point cut next week, up from about half that probability last month, according to the CME Group's FedWatch Tool.

Investors are also keenly watching who may succeed Fed Chair Jerome Powell when his term ends next year, with reports suggesting White House economic advisor Kevin Hassett is a top contender.

At 8:08 a.m. EST, Dow E-minis were up 42 points, or 0.09%, S&P 500 E-minis were up 17.25 points, or 0.25%, and Nasdaq 100 E-minis were up 102.50 points, or 0.40%.

Markets are also monitoring developments in Japan after the domestic central bank hinted at a potential rate hike, which sparked a selloff in global bonds including U.S. Treasuries on Monday. A hawkish move could unwind the yen carry trade.

Among top movers, Warner Bros Discovery rose 1.4% in premarket trading after reports said that it received a second round of bids, including an offer from Netflix.

Crypto stocks including Strategy and Coinbase were 2% and 1.5% higher, as bitcoin prices showed signs of stabilizing after its largest dollar loss since May 2021 in the previous session.

The Organisation for Economic Cooperation and Development raised its 2025 and 2026 growth forecasts for the U.S. economy, pointing to AI investment, fiscal support and potential Federal Reserve rate cuts.

Later in the day, Federal Reserve Vice Chair for Supervision Michelle Bowman is expected to testify before the House Financial Services Committee hearing on Oversight of Financial Regulators.