Index futures edge higher after home prices data

NEW YORK (Reuters) - Wall Street was set to open higher on Tuesday after signs of stabilization in U.S. home prices, while investors said forthcoming consumer confidence data could determine whether a September rally continues.

Signs the economy was on firmer footing have boosted equities about 9 percent in September. While the Standard & Poor's/Case-Shiller home price data did not dispute that view, investors said consumer confidence data later Tuesday would be critical for markets.

Peter Kenny, managing director at Knight Equity Markets in Jersey City, New Jersey, said consumer confidence has been a reliable indicator of market direction and could determine Wall Street's course through the end of the quarter.

"It's massively important this morning," he said. "If consumer confidence does not give the market a reason to trade higher we will fall off."

S&P 500 futures rose 2.4 points and were above fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures gained 30 points, and Nasdaq 100 futures added 9 points.

Walgreen Co , the biggest U.S. drug store chain, reported higher-than-expected quarterly earnings, helped by strong prescription drug sales, sending its shares up 8.1 percent to $32.80 in premarket trading.

Shares in Pulte Homes Inc rose 1.5 percent to $8.85 after Goldman Sachs removed the stock from its 'Americas Sell List' and upgraded it to "neutral" from "sell." Analysts pointed to share and debt purchases, cost cutting and bearish sentiment toward the stock.

Single-family home prices dipped in July, and are seen stabilizing near the lows without the homebuyer tax credit that ended in April, Standard & Poor's/Case-Shiller home price indexes showed on Tuesday.

The Conference Board's consumer confidence report is due at 10 a.m. EDT (1400 GMT) and is seen falling to 52.5 from 53.5, according to forecasts in a Reuters poll.

Continuing the spurt of recent M&A activity, Endo Pharmaceuticals Holdings Inc will buy private generics company Qualitest Pharmaceuticals for about $1.2 billion to expand its portfolio of pain drugs, marking its second deal in as many months.

The S&P 500 blew past a strong technical resistance level at 1,130 last week. Resistance is seen at about 1,173. The index closed at 1,142.16 on Monday.

(Reporting by Edward Krudy; editing by Jeffrey Benkoe)

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