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6466 + 130 2.04% 04:35

Overnight Markets: Wall Street surges on upbeat US housing data

Overnight Markets: Wall Street surges on upbeat US housing data

Wall Street surged nearly 3% on Tuesday led by banks, homebuilders and networking companies as upbeat housing starts added to expectations the world’s largest economy will weather Europe’s debt crisis.

The Dow Jones industrial average was up 336 points, or 2.87%, at 12,104. The Standard & Poor's 500 Index was up 36 points, or 2.98%, at 1,241. The Nasdaq Composite Index was up 81 points, or 3.19%, at 2,604.

Banking sector jumped after the US Federal Reserve rolled out fresh capital proposals that turned out to be less onerous than the market feared. JPMorgan Chase was up 5% and Wells Fargo added 4.6%.

Meanwhile, concern about Europe’s debt crisis eased after German business confidence unexpectedly gained and Spain sold €5.64 billion of bills, more than the maximum target.

Homebuilders surged after US housing starts and permits for future construction surged to 18-month high in November as demand for rental apartments rose. Pultegroup, the second-largest US homebuilder, was up 10% and MDC Holding surged 7.3%.

Networking companies rallied after AT&T dropped its bid for T-Mobile USA, the Deutsche Telekom unit. AT&T rose 1.3%. US-listed shares of Alcatel-Lucent surged 13% and Juniper Networks moved up 9.1%. Sprint Nextel jumped 9.3%.

Cyclical industries like materials were among the day's top gainers.

On the negative side, Oracle slumped 7.7% in extended trading after the company reported software and hardware sales that missed its own forecasts.

In Asia, equities gained on Wednesday in morning session on positive data on US housing starts and after payrolls increased in most states.

The MSCI Asia Pacific Index advanced 1.8% to 113 as of 11 a.m. in Tokyo. Japan’s Nikkei 225 Stock Average (NKY) increased 1.4%, while South Korea’s Kospi Index jumped 2.8%. Australia’s S&P/ASX 200 rose 2.1%. Hong Kong’s Hang Seng Index gained 1.7%.

In company news, Honda Motor Co. advanced 2.1% in Tokyo on speculation shipments will rise amid signs the US economy is improving. Onesteel, the second-worst performer in the MSCI Asia-Pacific index this year, jumped 7.1%.

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