* Oct existing home sales highest in 2-1/2 years
* Fed official comments weigh on U.S. dollar, lift oil
* Dow up 1.4 pct, S&P up 1.6 pct, Nasdaq up 1.6 pct
* For up-to-the-minute market news, click [STXNEWS/US] (Changes byline; updates to late morning)
By Angela Moon
NEW YORK, Nov 23 (Reuters) - Wall Street rallied on Monday, with the S&P set to reverse a three-day sell-off, as a weak U.S. dollar and better-than-expected home sales data encouraged investors.
The National Association of Realtors said sales of previously owned U.S. homes rose at a faster-than-expected pace to the highest in more than 2-1/2 years. The Dow Jones U.S. Home Construction index .DJUSHB gained 0.7 percent. For details, see [ID:nN23250199]
“The rise in home sales was primarily driven by the credit for first-time home buyers. But still, given the unemployment rate and given the number of foreclosures, you have to be very pleased about the numbers. It’s stellar,” said Tim Speiss, leader of Personal Wealth Advisors group at Eisner LLP in New York.
The Dow Jones industrial average .DJI was up 145.03 points, or 1.41 percent, at 10,463.19. The Standard & Poor’s 500 Index .SPX was up 17.62 points, or 1.61 percent, at 1,109.00. The Nasdaq Composite Index .IXIC was up 33.53 points, or 1.56 percent, at 2,179.57.
The U.S. dollar index .DXY slid 0.7 percent on comments by St. Louis Federal Reserve President James Bullard that the Fed should extend its mortgage-related assets purchase program to give policy-makers more flexibility. [ID:nN22246631]
Energy shares got a boost as January crude futures CLc1 gained 2.3 percent to $79.22. Dow component Chevron Corp CVX.N was up 2.9 percent at $79.
On the Nasdaq, News Corp NWSA.O rose 1.6 percent at $12.17 after sources said Microsoft Corp MSFT.O has talked about a deal in which News would get paid to take its news websites off Google Inc GOOG.O. [ID:nN22225861]
Microsoft added 1 percent at $29.93, and Google increased 2.4 percent at $583.65.
On the downside, Ciena Corp CIEN.O shed 8.4 percent to $12.07 after it agreed to buy the optical networking and ethernet equipment businesses of bankrupt Nortel Networks NRTLQ.PK.
The Morgan Stanley Healthcare Payor index .HMO gained 4.1 percent, while the AMEX Pharmaceutical index .DRG was up 1.2 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]
Reporting by Angela Moon; Editing by Jan Paschal