World markets rose sharply Monday amid further hopeful signs about the global economic recovery. Commodity stocks led the charge, particularly in London, after gold hit another record high.

In Europe, the FTSE 100 index of leading British shares closed up 104.09 points, or 2 percent, at 5,355.50 while Germany's DAX rose 138.33 points, or 2.4 percent, to 5,801.48. The CAC-40 was 83.81 points, or 2.3 percent, higher at 3,813.17.

In the U.S., the Dow Jones industrial average was up 146.54 points, or 1.4 percent, at 10,464.70 around midday New York time while the broader Standard & Poor's 500 index rose 17.79 points, or 1.6 percent, to 1,109.17.

Sentiment was buoyed by solid economic data in both Europe and the U.S.

In Europe, figures showed that the economic recovery is gathering pace in the 16 countries that use the euro. The monthly composite purchasing managers index _ a broad gauge of business activity in the manufacturing and services sector _ rose to 53.7 in November from October' 53.

Any reading above 50 indicates expansion and the bigger the difference from 50 the greater the expansion _ figures recently confirmed that the recession in the eurozone economy ended in the third quarter, though growth was muted.

In the U.S., the National Association of Realtors said existing home sales in October rose by 10.1 percent to an annual rate of 6.1 million units _ a two and a half year high _ as buyers took advantage of a tax credit. Nevertheless, the increase was way more than expected and fueled the optimism on Wall Street, which had already opened higher on the back of the strong gains in Europe.

Much of Monday's activity centered on commodity stocks as the price of gold spiked $22 an ounce, or 1.9 percent, to a new record of $1,170.

Gold was boosted by a drop in the dollar's value after U.S. Federal Reserve official James Bullard said the central bank should continue to buy mortgage-backed securities after the program is supposed to expire in March. Bullard is expected to join the Fed's rate-setting body next year.

As a result, the minutes to the last rate-setting meeting of the Fed _ due to be published Tuesday _ will be pored over for any clues as to whether the purchases will continue after the planned March deadline.

Any suggestion that the Fed will maintain its extraordinary monetary policy measures for longer than previously anticipated heaps pressure on the dollar _ by late afternoon London time, the euro was up 0.8 percent at $1.4980, having earlier breached the $1.50 mark for the first time in a week.