US homebuilder sentiment climbs higher in May

U.S. homebuilders are feeling more optimistic about their business prospects, reflecting a recent surge in sales of newly built homes and a lingering shortage of previously occupied homes on the market.

The National Association of Home Builders/Wells Fargo builder sentiment index released Monday rose to 70 this month. That's up two points from 68 in April.

Readings above 50 indicate more builders view sales conditions as good rather than poor. The index has been above 60 since September.

The May index exceeded analyst predictions, which called for the reading to hold steady from last month, according to FactSet.

Readings gauging builders' view of sales now and over the next six months also rose from last month, while a measure of traffic by prospective buyers edged lower.