Stocks rose on Tuesday as expectations grew that a default of Greek debt could be avoided and sovereign risk in other euro zone countries could be contained.
Euro zone finance ministers said the Greek government had until July 3 to approve new steps to get the next installment of 110 billion euros in European Union and International Monetary Fund aid.
A consensus grew that Greek Prime Minister George Papandreou would survive a confidence vote on Tuesday -- a key hurdle the government must clear to avert the euro zone's first sovereign debt default. The vote is due around 5 p.m. EDT.
The Greek debt has been an issue in the market for a year and a half. Now it's in the front and center. This (vote) is not the end of it, but it will deflect market concerns for a while, said Tim Ghriskey, chief investment officer of Solaris Asset Management in Bedford Hills, New York.
The Dow Jones industrial average <.DJI> was up 40.00 points, or 0.33 percent, at 12,120.38. The Standard & Poor's 500 Index <.SPX> was up 5.15 points, or 0.40 percent, at 1,283.51. The Nasdaq Composite Index <.IXIC> was up 6.91 points, or 0.26 percent, at 2,636.57.
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U.S. home sales data for May was due at 10 a.m. EDT. Analysts in a Reuters survey expected sales to drop to about 4.8 million, compared with 5.05 million the month before.
(Reporting by Angela Moon; editing by Jeffrey Benkoe)