Yesterday's unexpected Italian election results threw stock markets around the world into chaos as fears arose that an anti-austerity government might undo the hard-won progress made in stabilizing the European economy. With the Italian Parliament apparently in deadlock, those uncertainties won't go away anytime soon, but U.S. investors this morning looked beyond Europe as positive data on new-home sales and consumer confidence supported a bounce-back in stocks. As of 10:45 a.m. EST, the Dow Jones Industrials (DJINDICES:^DJI) are up 50 points, although broader markets were somewhat ominously more muted.

Among Dow stocks, Home Depot (NYSE:HD) led the average higher, soaring almost 6% after beating analyst estimates for the fourth quarter and announcing a mammoth 34% dividend increase to $0.39 per share quarterly, as well as a $17 billion share buyback. Strong same-store sales and rising revenue and net income are just another sign that the housing market has started to recover more substantially, and the collateral impact on the rest of the economy could well provide the next leg up for the slow-paced U.S. expansion. For Home Depot shareholders, moreover, the company's target of a 50% payout ratio gives the dividend more room to rise as Home Depot's prospects improve.

Elsewhere, CommonWealth REIT (NYSE:EQC) reversed yesterday's big loss, soaring 33% on news that two activist investors had teamed up to take a nearly 10% stake in the real-estate investment trust, calling for the REIT to cancel a plan to raise $450 million in a secondary share-offering. With the filing from Corvex Management and Related Companies indicating that the REIT's assets are worth $40 per share and setting expectations for a $50 price target, today's jump to about $21 could be just a hint of future gains if the investors are correct.

Finally, sticking with the real-estate theme, homebuilders Standard Pacific (NYSE:SPF) and Hovnanian (NYSE:HOV) have risen 4.5% 5.8%, respectively. The bounce is a natural reaction to favorable new-home sales figures, but bear in mind that this only regains a small portion of the ground the two stocks have lost in the past month. After the big gains homebuilder stocks have made, favorable housing data alone won't be enough to lift them further. Investors will need to see results as the spring and summer buying season heats up.

Fool contributor Dan Caplinger has no position in any stocks mentioned. You can follow him on Twitter @DanCaplinger. The Motley Fool recommends Home Depot. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.