YORK (Dow Jones)--U.S. stock futures advanced following another successful Spanish debt auction and as domestic home building jumped in November to its highest level in nearly two years.

Less than an hour before the opening bell, Dow Jones Industrial Average futures gained 108 points, or 0.9%, to 11811 and was on track to recoup Monday's losses. The Dow dropped 100 points in the previous session and closed at the lowest level of the month.

Standard & Poor's 500-stock index futures climbed 14 points, or 1.1%, to 1212 and Nasdaq 100 futures rose 22 points, or 1%, to 2234. Changes in stock futures don't always accurately predict stock moves after the opening bell.

Stock futures stayed higher after U.S. housing starts surged 9.3%, rising in November to the highest level in 19 months. Construction permits also grew. Both are encouraging signs for the housing market, which has struggled for years.

European markets were mostly higher, with the Stoxx Europe 600 up 0.4%, after better-than-expected data out of Germany. The Ifo Institute's closely-watched business confidence index rose in December, exceeding analysts' projections.

Separately, Spain sold EUR5.64 billion ($7.33 billion) of short-term Treasury bills, exceeded the maximum target of EUR4.5 billion. The average yields fell sharply from the previous auction of bills in November. Last week, Spain sold nearly double the amount of longer-term bonds than it had targeted.

Asian bourses bounced, with South Korea's Kospi rising 0.9%, after sliding 3.4% on Monday, and Japan's Nikkei Stock Average tacking on 0.3%. Worries about the implications of the death of North Korean leader Kim Jong Il receded.

Gold futures added 0.8% to $1,608.70 an ounce, while crude oil futures ran up 1.7% to $95.61 a barrel. The U.S. dollar lost ground against the euro and the yen.

Shares of AT&T shed 1% in premarket trading after the blue chip telecommunications company withdrew its $39 billion bid for T-Mobile USA. AT&T said it would pay $3 billion in cash and turn over some of its wireless spectrum to T-Mobile's owner, Deutsche Telekom, for failing to complete the deal, first announced in March.

Meanwhile, Sprint Nextel rallied 6.9%. The stock had dropped 14% on March 21 after AT&T's bid to buy T-Mobile was announced. It has lost more than half its value since the bid was unveiled.

Jefferies shares jumped 6.9% after the investment bank's quarterly results beat analysts' estimates.

General Mills slipped 3.7% after the packaged-food company reported fiscal second-quarter earnings that fell short of expectations.

Navistar surged 11% after the commercial and military truck maker's fiscal fourth-quarter earnings were well above forecasts as margins widened.

Red Hat slid 8% after the company reported fiscal third-quarter earnings that topped analyst forecasts, but disappointed investors by only matching revenue estimates.

Oracle, which is slated to report fiscal second-quarter results after the close, gained 1.1%.

-By Steven Russolillo and Tomi Kilgore, Dow Jones Newswires; 212-416-2180; 
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