Wall Street rises as economic gloom lifts

Wall Street stocks advanced on the first trading day of the week, buoyed by strong economic data from around the world.

In New York, a local manufacturing index well outstripped expectations, adding to the optimism that drove overseas markets higher.

A German economic sentiment indicator rose to the highest level since July 2011 while China's economy expanded 8.9% during the fourth quarter, above expectations of 8.7%.

This fuelled a 4.2% rise in the Shanghai Composite, the biggest jump since October 2009.

Wall Street closed well off session highs as an early rally ran up against technical resistance and weakness in bank stocks after a handful of key earnings reports.

The Dow Jones Industrial Average closed up 60.01 points, or 0.5%, to 12,482.07, as almost all components firmed. The gains were still enough to push the blue-chip index to what would be a fresh closing high since late July. The Dow already breached five-month highs earlier this month.

The S&P 500 index gained 0.4% to 1293.67 and the Nasdaq Composite was up 0.7%, to 2736.

Cruise-line operator Carnival's stock was one of the worst performers in the S&P 500, slumping 14% after the sinking of the Costa Concordia off the Italian coast with the loss of 11 lives and several dozen more still missing. Fellow cruise ship operator Royal Caribbean dropped 3.3%.

Other markets: Europe, Asia up
European markets gained, with the Stoxx Europe 600 up 0.9%to 253.27 on the back of broad gains in Asia.

Germany's DAX index added 1.8% to 6332.93 after the ZEW indicator of economic sentiment spiked to 32.2 points to minus 21.6 in January.

France's CAC 40 rose 1.4% to 3269.99 and the UK’s FTSE 100 index gained 0.7% to 5693.95, boosted by a 1.8% rise for Royal Bank of Scotland Group, which said it would sell its aircraft-leasing unit for $US7.3 billion to a consortium of Sumitomo Mitsui Financial Group.

Asian sharemarkets climbed as investors digested the better-than-expected Chinese economic data. The Shanghai Composite jumped 4.2% to 2298.38 after dropping for the past four trading days.

Hong Kong's Hang Seng Index gained 3.2% to 19,627.75, Japan's Nikkei Stock Average climbed 1.1% to 8466.40 and Australia's S&P/ASX 200 index added 1.7% to 4215.6.

Korea's Kospi rose 1.8% to 1892.74 and Taiwan's Taiex added 1.7% to 7221.08.

Commodities: Oil rises above $US100, gold up
Oil futures jumped back above $US100 a barrel, lifted by better-than-expected economic growth in China that boosted expectations for higher crude demand.

Light, sweet crude for February delivery gained $US1.55, or 1.6%, to $US100.25 a barrel in New York. Brent crude on ICE Futures Europe added 15USc to $US111.49 a barrel.

Gold futures on rallied to their best in more than a month, relying on a weakening US. dollar as well as rallies for oil futures and stocks.

The February delivery settled $24.80, or 1.5%, higher at $US1655.60 an ounce in New York, the highest settlement since December 13.

Currencies: Euro rises, Aussie at 11-week high
The euro was higher, underpinned by solid German and Chinese economic data, but it pared early gains against the US dollar as the eurozone crisis continued to weigh on investor confidence.

The euro was at $US1.2740 compared with $US1.2667 late on Monday. The dollar was at ¥76.77 compared with ¥76.79, while the euro was at ¥97.838 compared with ¥97.25.

The UK pound traded at $US1.5349 compared with $US1.5326, while the dollar bought 0.9493 Swiss franc from 0.9543 franc.

The Australian dollar rose to an 11-week high above $US1.04 before dropping back to $US1.0395 from $1.0314 late Monday.