(RTTNews) - Crude oil prices rallied toward $78 per barrel on Monday morning as traders considered encouraging manufacturing data from both the U.S. and China.

Light sweet crude for December delivery rose to $77.90, up 90 cents on the session. Prices reached as high as $78.25.

In China, the HSBC Purchasing Managers' Index stood at 55.4 in October, up from 55.0 in September. This is highest reading recorded since April 2008. A reading above 50 indicates expansion, while one below 50 suggests contraction.

Later, in the U.S., the Institute for Supply Management manufacturing index rose to 55.7 in October from 52.6 in September, with a reading above 50 indicating growth in the sector. Economists had been expecting a more modest increase by the index to a reading of 53.0.

In other U.S. economic news, the Commerce Department revealed that construction spending rose 0.8 percent in September. This followed a 0.1 percent decline in August and a 1.2 percent slide in July.

The National Association of Realtors announced the pending home sales index rose 6.1 percent to 110.1 in September from a reading of 103.8 in August. The increase by the index came as a surprise to economists, who had expected the index to edge down 0.1 percent.

The dollar dropped lower versus the euro and sterling following the three economic reports at around 10 a.m. ET. The greenback had seen modest strength in the early morning.

For comments and feedback: contact editorial@rttnews.com

Copyright(c) 2009 RTTNews.com, Inc. All Rights Reserved