US open: Stocks continue to advance despite weak housing data

US stocks advanced on Monday despite some weaker-than-expected economic data, as markets continued to rally ahead of the Christmas break.

The Dow Jones Industrial Average was up 0.5% by 10:00 in New York, while the Nasdaq gained 0.2% and the S&P 500 rose 0.1%.

US stocks rallied at the end of last week, registering their biggest weekly gains since October, after the Federal Reserve said it would be “patient” on the timing of its first rate hike.

Existing home sales in the States plunged by 6.1% to 4.9m in December after a revised 1.4% gain to 5.25m the month before. Analysts were forecasting a small fall to 5.2m.

"The US markets continued to follow the trends they had fallen into at the end of last week, and poor existing home sales figures had no impact on the US markets," said analyst Connor Campbell from Spreadex.

"This could change tomorrow as they face final gross domestic product, new home sales and core durable goods orders; these will be the final major challenge for the US markets before Christmas."

In corporate news, fashion retailer American Apparel jumped after the company said it has received an "indication of interest" to buy the firm at a price of $1.30-1.40 a share, 21-31% higher than Friday's closing price.

AbbVie fell despite the news that Express Script Holding will make one of the firm’s drugs the exclusive option for patients with the most common form of hepatitis C. As a result, AbbVie is expected to take market share from Gilead Sciences, which dropped over 11% after the bell.

Energy stocks such as Anadarko Petroleum, Devon Energy, Chevron and Conocophllips were trading with heavy losses as crude prices resumed their decline. West Texas Intermediate futures were down 1.8% at $56.13 a barrel.