Investors pushed stocks higher for a fourth day on Thursday as coordinated central bank action encouraged optimism about dealing with the euro zone debt crisis and its threat to the global recovery.
Major stock indices rose more than 1 percent. Shares of financial companies, which have been among the hardest hit by the debt worries, outperformed other sectors.
The S&P financial index <.GSPF> and the S&P industrial index <.GSPI> each rose 1.8 percent.
Shares of Bank of America
The European Central Bank, along with other major central banks, will reintroduce three-month dollar liquidity operations in the fourth quarter.
The move benefited the European banking system, which experienced new stress in finding dollar funds due to nervousness by lenders.
The bottom line is the EU and the IMF and the industrialized nations are trying to convince the market that the euro is here to stay, euro land is not going to disintegrate and Greece is probably going to avoid a default, said Peter Cardillo, chief market economist at Rockwell Global Capital in New York.
The Dow Jones industrial average <.DJI> was up 149.21 points, or 1.33 percent, at 11,395.94. The Standard & Poor's 500 Index <.SPX> was up 15.81 points, or 1.33 percent, at 1,204.49. The Nasdaq Composite Index <.IXIC> was up 28.38 points, or 1.10 percent, at 2,600.93.
Worries about a Greek default have plagued the stock market for weeks.
While the S&P 500 index is still down 10 percent since July 22, the broad gauge has managed a 4.3 percent gain so far this week.
Advancers were leading decliners by about 3 to 1 on the New York Stock Exchange.
Optimism over containing the debt crisis came even as German Chancellor Angela Merkel rejected the idea of euro zone bonds as a solution.
A top official said he expects lenders to recommend the release of a vital next tranche of aid to Greece, warding off the threat of an imminent default. (Reporting by Caroline Valetkevitch, additional reporting by Ryan Vlastelica; Editing by Kenneth Barry)