NEW YORK, May 26 (Reuters) - Overseas shares traded in the United States rose on Tuesday as investors were encouraged by signs of recovery in the U.S. economy, which more than offset earlier worries about weapons tests in North Korea.

A reading of consumer confidence in the U.S. rose to an eight-month high in May, signaling to an end in the spending slump and to a recovering economy, following data that showed home prices were still falling though the pace of the decline slowed. For details, see [ID:nN26489555]

Bellwethers in most regions and sectors rose, with New York-traded shares of Spain's Banco Santander (STD.N: Quote, Profile, Research) up 3.4 percent to $10.46 and Brazilian energy company Petrobras (PBR.N: Quote, Profile, Research) up 3.3 percent to $41.93.

The Bank of New York Mellon's index of leading American Depositary Receipts (ADRs) gained 2.2 percent while the U.S. benchmark S&P 500 index .SPX rose 2.63 percent.

On the downside, ADRs of South Korean companies including KB Financial Group Inc (KB.N: Quote, Profile, Research) and steelmaker POSCO (PKX.N: Quote, Profile, Research) fell as investors digested news of North Korea's weapons tests. The Bank of New York Mellon index of Korean ADRs slid 2.6 percent.

But the Bank of New York Mellon's index of leading Asian ADRs rose 2 percent, despite overnight declines in most Asian markets, which were weighed by political risk in the Korean peninsula.

ADRs of Japan's Toyota Motor (TM.N: Quote, Profile, Research) gained 3.3 percent to $77.79 and Mizuho Financial Group (MFG.N: Quote, Profile, Research) jumped 6 percent to $4.95.

The Bank of New York Mellon's index of leading European ADRs rose 2.3 percent. In Europe, the FTSEurofirst 300 index of top shares ended 0.9 percent higher, also boosted by U.S. confidence data.

New York crude oil futures CLc1 rose 1.3 percent to $62.45 per barrel, helping ADRs of energy companies lead gains. Royal Dutch Shell (RDSb.N: Quote, Profile, Research) rose 3.2 percent to $53.62 and Italy's Eni SpA (E.N: Quote, Profile, Research) gained 3.9 percent to $48.31.