Miners led global stocks higher, after investors examined Chinese economic data and Alcoa Inc.'s earnings and decided both were positive for commodities and growth.
Britain's FTSE 100 gained 1.1 per cent, France's CAC 40 surged 2.4 per cent, and Germany's DAX rose 2.4 per cent. Japan's Nikkei ended 0.4 per cent higher, while Hong Kong's Hang Seng rose 0.7 per cent.
Dow futures pointed towards a market-opening gain of 96 points, or 0.8 per cent. S&P 500 futures were up 11.5 points, or 0.9 per cent, at 1,287.10 points.
Alcoa kicked off the U.S. earnings season after the market closed on Monday with a net loss, excluding restructuring costs, that met analysts' estimates of 3 cents a share. Sales rose 6 per cent.
Chinese data showed exports and imports grew at their slowest pace in more than two years in December. The figures fuelled expectations that Beijing will act to support spending in the world's second-largest economy, most likely by easing monetary policy.
Copper rose almost 2 per cent, trading at $7,615 a tonne. China's imports of copper rose 12.6 per cent to a record high in December from the previous month.
The euro gained slightly to trade around $1.2792 (U.S.), holding above the 16-month lows of $1.2666 hit on Monday.
The Bank of France said growth had stalled in the fourth quarter of 2011, while separate data showed French industrial production rose 1.1 per cent in November, defying expectations of zero growth.
A number of European countries, including Italy, could see their credit ratings downgraded by the end of this month, Fitch Ratings said. The agency has Italy, Spain, Belgium, Ireland, Slovenia and Cyprus on "ratings watch negative," and the reductions could be as deep as two notches, Fitch said.
British retailers finished 2011 with the best sales growth in months amid hefty discounting.
U.S. crude oil rose to nearly $103 a barrel Tuesday amid concerns about tensions over Iran, a strike which could affect Nigerian oil production, and growing optimism that the U.S. economy is improving. Brent crude gained 97 cents to trade at $113.42 a barrel.
Gold rose 1 per cent, back above $1,625 an ounce. It is already up 4 per cent from the start of the year.
The Canadian dollar traded at 98.19 U.S. cents.
Sonali Verma