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NEW YORK: US stocks roared higher on Monday, helped by strong housing data and a weak dollar that boosted commodities and overall sentiment for investor risk.
The Dow Jones Industrial Average jumped 132.79 points (1.29 percent) to 10,450.95 to the highest close since October 2008, rebounding from a three-session losing streak.
The tech-heavy Nasdaq rose 29.97 points (1.40 percent) to 2,176.01 and the broad-market Standard & Poor's 500 index added 14.86 points (1.36 percent) to 1,106.24, reclaiming its perch atop the 1,100 level.
Both indexes ended lower last week.
Stocks surged from the opening bell as the dollar weakened with expectations that interest rates would remain at near zero low levels. The rise was further fuelled by a home sales jump.
A rush to cash in on tax incentives helped propel sales of existing homes by 10.1 percent in October, giving momentum to the ailing sector, the National Association of Realtors said.
Sales of existing single family homes and apartments rose to a seasonally-adjusted annual pace of 6.10 million units, well ahead of market expectations of 5.7 million.
"The stabilisation of the housing market is one factor that could get the US consumer back on its feet sooner than expected," analysts at Charles Schwab & Co said in a report.
In the past week, the market was chilled by data showing a 10.6 percent slide in October housing starts, along with a drop of four percent in permits to build new homes, a leading indicator of the sector.
Weakness in the US dollar also prompted a run on commodities and equities heading into the open, with traders reacting to exit strategy comments at the weekend from a Federal Reserve official.
Comments by Federal Reserve Bank of St. Louis President James Bullard that he would prefer to keep the central bank's asset-buying program active beyond its current cut-off date pushed the dollar lower, analysts said.
An extension of the programme, widely considered a negative factor for the US currency, would give more flexibility to US policymakers, he said.
"Bullard's comments stand in stark contrast to the action of the European Central Bank, which announced its first tightening steps on Friday," analyst Joseph Hargett of Schaeffer's Investment Research said.
The holiday-shortened week ahead will provide other key economic data to digest, including Tuesday's revised estimate for US gross domestic product (GDP) in the third quarter. Most analysts expect a revision to show 3.0 percent expansion from a first estimate of 3.5 percent.
The market will be closed on Thursday for the Thanksgiving Day and be open only half a day the next day.
Among gainers on Monday were energy giants ExxonMobil, up 1.77 percent to 75.70 dollars and Chevron, rising 2.57 percent to 78.74 dollars.
Ciena, a key player in the optical network equipment market, plunged 8.88 percent to 12.00 dollars after it won a bid to acquire a Nortel Networks division for 769 million dollars in cash and notes.
The winning bid was above the valuation range of some analysts.
The bond market declined. The yield on the 10-year US Treasury bond rose to 3.364 percent from 3.356 percent on Friday and that on the 30-year bond was up to 4.287 percent from 4.295 percent. - AFP/de
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