* October existing home sales highest in 2-1/2 years
* Fed official’s comments weigh on U.S. dollar, lift oil
* Dow up 1.3 pct, S&P up 1.4 pct, Nasdaq up 1.4 pct
* For up-to-the-minute market news, click [STXNEWS/US] (Updates to midday)
By Angela Moon
NEW YORK, Nov 23 (Reuters) - U.S. stocks advanced on Monday, with the S&P 500 on track to snap a three-day sell-off, as a weak U.S. dollar and better-than-expected home sales data encouraged investors.
Sales of previously owned U.S. homes rose at a faster-than-expected pace to the highest in more than 2-1/2 years, according to the National Association of Realtors. The Dow Jones U.S. Home Construction Index .DJUSHB gained 0.3 percent.
The U.S. dollar index .DXY slid 0.7 percent following comments from St. Louis Federal Reserve President James Bullard, who said on Sunday that the Fed should extend its mortgage-related assets purchase program to give policy-makers more flexibility. [ID:nN22246631]
“The home sales complement a strong upward trend we are seeing now ... there are a lot of people still on the sidelines to pile in because we never had what’s called a technically good bottom since March (lows) and this will continue the rally,” said Paul Lange, vice president of services at Team Trading LLC in New York.
The Dow Jones industrial average .DJI was up 131.20 points, or 1.27 percent, at 10,449.36. The Standard & Poor’s 500 Index .SPX was up 15.27 points, or 1.40 percent, at 1,106.65. The Nasdaq Composite Index .IXIC was up 29.42 points, or 1.37 percent, at 2,175.46.
Energy shares got a boost as January crude futures CLc1 gained 1.3 percent, or 98 cents, to $78.45 a barrel, with Dow component Chevron Corp (CVX.N) up 2.9 percent at $78.99.
On the Nasdaq, News Corp (NWSA.O) rose 0.4 percent to $12.03 after sources said Microsoft Corp (MSFT.O) has talked about a deal in which News Corp, which owns The Wall Street Journal and the New York Post, would get paid to take its news websites off Google Inc (GOOG.O). [ID:nN22225861]
Microsoft added almost 1 percent to $29.91. Google climbed 2.1 percent to $582.65.
The Morgan Stanley Healthcare Payor index .HMO gained 3.6 percent, while the AMEX Pharmaceutical index .DRG was up 1.1 percent, buoyed by news that U.S. President Barack Obama’s healthcare reform plan cleared an important Senate hurdle over the weekend. But lawmakers warned of challenges ahead in winning support for passage, even among Obama’s fellow Democrats. [ID:nN22214162]
On the downside, Ciena Corp CIEN.O shed 9.5 percent to $11.91 after it agreed to buy the optical networking and ethernet equipment businesses of bankrupt Nortel Networks NRTLQ.PK. (Reporting by Angela Moon; Editing by Jan Paschal) ((firstname.lastname@example.org; Tel: +1 646 223 4000;