Stocks advanced Thursday as Greece said it won't hold a vote on the nation's bailout and the European Central Bank unexpectedly cut interest rates.
The Dow Jones industrial average closed up 208.43, or 1.76%, at 12,044.47; the S&P 500 rose 23.25, or 1.88%, closing at 1,261.15; and the Nasdaq composite was up 57.99, or 2.2%, at 2,697.97. All numbers are preliminary.
Stocks tumbled earlier this week as Greek Prime Minister George Papandreou announced on Oct. 31 a parliamentary confidence vote and his desire to hold a referendum on the rescue pact. A two-day slump sent the S&P 500 to the level where three rallies stopped in August and September, the top of a price range that prevailed for 10 weeks. The index rose above that level last week amid progress on Europe's bailout plans.
Greek Finance Minister Evangelos Venizelos, speaking to party lawmakers in Parliament in Athens on Thursday, said the nation won't hold a referendum. Just hours after saying Greeks need to decide on whether their future is in the euro, Mr. Papandreou said the country belongs in the currency bloc.
Global stocks also rose as ECB officials unanimously lowered the benchmark interest rate by 25 basis points to 1.25%. ECB President Mario Draghi said the rate cut happened partly because “what we're observing now is slow growth heading toward a mild recession.”
Earlier Thursday, benchmark gauges erased a rally as a report showed that service industries in the U.S. expanded at a slower pace and consumer confidence plunged, supporting Federal Reserve Chairman Ben S. Bernanke's forecast on Wednesday that the economic recovery will be “frustratingly slow.”