The recently reported favorable U.S. housing data and rising oil prices are fuelling stock gains around the world. Asian shares closed up on Wednesday and European markets opened on a positive note.

In the U.S., housing data for April showed that new home sales during the period rose at the fastest rate in more than eight years. Home prices also increased in April. The favorable housing data strengthened confidence among investors that the Fed interest rate hike won’t compromise U.S. economic growth. Growing hope of Fed rate hikes boosted the dollar and fuelled gains in U.S. equities overnight and foreign investors picked up the signal with stock gains in Asia and elsewhere.

In Japan, the Nikkei 225 Index (INDEXNIKKEI:NI225) gained 1.6% at closing. The stronger USD/JPY (JPYUSD) boosted gains for the country’s exporters as their commodities were cheaper for holders of USD. In China, the smaller Hang Seng Index (INDEXHANGSENG:HSI) rose 2.4%, but the larger Shanghai Composite surrendered all the gains it had accumulated earlier in the day to close 0.23% in the red. Concerns over sluggish economic growth in China weighed down the country’s main stock index.

In Taiwan, the Taiwan Weighted gained 1.15%, backed by gains in Optoelectronic, Semiconductor and other electronic sectors.

Australian shares also closed on a positive note with the S&P/ASX 200 moving north 1.58%. The gain in Australian equities was led by Financials, Energy and Telecoms services sectors.

Currency outlook

The USD (CURRENCY:USD) gained 0.2% against the JPY and was steady against a basket of six trade-weighted other major currencies. The strength of the USD had its roots in the positive U.S. economic data that showed remarkable improvements in home sales and increasing hope that the Fed will soon roll out the first phase of interest rate increases for 2016.

Commodities

Oil (NYSEARCA:OIL) moved toward $50 a barrel during Asian trading, signalling growing hope that shrinking fresh supply of crude oil will help wipe out the glut that has doused prices. Industry data showed that U.S. crude oil inventories declined sharply. The Canadian wildfire and unrest in Nigeria’s oil region are some other events expected to help ease the oversupply situation in the oil market.