Wall Street was set for a flat open on Tuesday as investors reassessed a vow by China for more flexibility on its currency and tread cautiously ahead of data expected to show a slight rise in U.S. home sales last month.

The Federal Reserve's rate-setting committee was also set to begin a two-day meeting, with a statement to be released on Wednesday. Investors will watch for any minor changes in language that could illustrate the central bank's outlook on the economy.

Optimism over China's weekend decision to give the yuan more flexibility faded late Monday and weighed on world stocks and the euro amid doubts about the speed and magnitude of Beijing's intentions.

It's a rethink of the China move, said Tom Schrader, managing director of U.S. equity trading at Stifel Nicolaus Capital Markets in Baltimore.

Certainly China's going to let their yuan float a little bit, but the key word there is 'a little bit.' They are certainly not going to allow it to get rabid.

The market open could test the S&P 500's 200-day moving average, which stands near the 1,110 level. The index broke through the moving average last week, a bullish signal, and holding that level could provide support for more gains. The index closed at 1,113.20 on Monday.

U.S. existing home sales for May are due at 10 a.m., and economists are expecting an annual rate of 6.12 million units versus 5.77 million the month before.

The Federal Reserve Bank of Richmond's June indexes on the region's manufacturing and service sectors are also expected at 10 a.m.

Shares of Walgreen Co slid 4.6 percent to $28.75 in premarket trade after the company reported weaker-than-expected profit.

S&P 500 futures were off less than a point 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 slipped 1 point, and Nasdaq 100 futures gained 0.75 of a point.

Oil services companies waited to see if they win a legal fight to overturn a six-month ban on deepwater drilling in the Gulf of Mexico. A U.S. judge will decide by Wednesday whether to temporarily lift the ban.

Large banks looked likely to face new limits on debit-card transaction fees as a key U.S. senator said he reached a deal to include the provision in an overhaul of financial regulations. But the new deal scales back the limits on fees card networks like Visa Inc and MasterCard would have faced.

Drugmaker Pfizer Inc is pulling a decade-old leukemia medicine off the U.S. market after a study found a higher death rate and no benefit for patients.

U.S. President Barack Obama is expected to warn health insurance executives at a White House meeting against imposing big rate increases ahead of tighter rules under the new healthcare law, The New York Times reported.

Stocks ended lower Monday, once again succumbing to late-day selling in light trading.

(Editing by Padraic Cassidy)

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