May 24, 2016 11:32 PM

Asian stock markets rally on US recovery hopes

The Associated Press

SEOUL, South Korea (AP) Asian stock markets rallied Wednesday as solid U.S. housing sales data and overnight gains on Wall Street raised expectations for a strong recovery in the world's largest economy.

KEEPING SCORE: Japan's Nikkei 225 rose 1.7 percent to 16,778.97 and Hong Kong's Hang Seng index jumped 2.3 percent to 20,283.56. South Korea's Kospi gained 1.1 percent to 1,957.87 while Australia's S&P/ASX 200 advanced 1.7 percent to 5,383.70. Stocks in Taiwan, Singapore and Southeast Asia also gained.

US RECOVERY: The U.S. Commerce Department said Tuesday that new home sales leaped 16.6 percent last month to a seasonally adjusted rate of 619,000, the highest level since January 2008. Steady job gains and low mortgage rates have encouraged more Americans to buy new homes in a sign that the housing market and the broader economy are in good shape.

ANALYST'S TAKE: "Such upbeat data have dissipated doubts concerning the recovery in the housing sector," Mizuho Bank said in a daily commentary. "While this strengthens expectations that the Fed may be more comfortable to raise policy rate in summer, markets do not appear to be unsettled."

WALL STREET: U.S. stocks on Tuesday notched their biggest gain since March. The Dow Jones industrial average rose 1.2 percent to 17,706.05 and the Standard & Poor's 500 index gained 1.4 percent to 2,076.06. The Nasdaq composite index surged 2 percent to 4,861.06.

OIL: Benchmark U.S. crude gained 62 cents to $49.24 per barrel in New York. The contract finished 54 cents higher at $48.62 on Tuesday. Brent crude, used to price international oils, rose 56 cents to $49.17 a barrel in London.

CURRENCIES: The dollar rose to 110.13 yen from 110.06 yen. The euro strengthened to $1.1147 from $1.1143.

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