US shares extended gains today as sentiment was boosted by a surge in new home sales and higher earnings of companies.
The Dow Jones Industrial Average jumped 100.81 points (0.97 per cent) to a two-month high of 10,525.43, after posting a 3.2 per cent jump last week.
The tech-rich Nasdaq composite index gained 26.96 points (1.19 per cent) to 2296.43 while the broader S&P 500 index added 12.35 points (1.12 per cent) at 1115.01.
The S&P 500 had finished 3.5 per cent higher last week, breaching the 1100 level for the first time since June 21.
"US stocks are extending the solid gains from last week as upbeat economic news is supporting economic recovery sentiment, with today's dose of data coming in the form of a sharp jump in new home sales," analysts at Charles Schwab & Co said in a client note.
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Shares "spiked suddenly with the data's release," analysts at Briefing.com said, citing the strong rebound of new home sales in June after plunging to a record low the previous month.
The Commerce Department said sales increased 23.6 per cent to 330,000 units from a revised May rate of 267,000, a record low.
But economists cautioned the market against reading too much into the large sales increase.
"Builders sold almost no new homes in May so the sharp rise in June shouldn't be taken as a sign the housing market is suddenly on fire," said analyst Joel Naroff with Naroff Economic Advisers.
Market optimism also came today from the US corporate earnings front.
As many companies lived up to expectations of higher-than-expected profits, FedEx, a top US package-shipping company and economic belwether, boosted its first quarter and full-year earnings forecast.
Of the 175 S&P 500 companies that have reported their quarterly earnings, 78 per cent came in better than expected, led by those in the technology, financials, and industrial sectors.
US shares mixed ahead of housing dataHome sales take unexpected dip
