The Dow Jones industrial average increased back above 10,000 on hope that the European Union will help Greece manage its growing debt burden.
The Dow rose 150 points yesterday, a day after closing below 10,000 for the first time in three months. The major indexes all gained more than 1 percent.
Global markets bounced back on reports that the president of the European Central Bank, Jean-Claude Trichet, is changing his travel schedule to attend a meeting of EU officials on Thursday and that plans are being developed to rescue Greece. The reports are raising hopes that policymakers will take bigger steps to contain troubles in Greece, which is struggling with big budget gaps and is seeing demand fall for its debt.
Though Greece's economy is small, investors are concerned that troubles there will spill into other countries. World stock markets have been tumbling in recent weeks on concerns that debt problems would spread. Investors are also concerned by budget gaps in Ireland, Portugal and Spain and the uncertainty has undermined Europe's common currency, the euro.
The European debt problems are the latest obstacle for investors who have put the market's 10-month rally on hold. Stocks began retreating in mid-January after China said it would try to control its economy to avoid speculative bubbles. Things got worse when President Obama announced plans to curb trading by large financial institutions.
Yesterday, Greece took its latest steps to calm markets, pledging to raise retirement ages, raise fuel taxes and accelerate reforms. However, a strike over the government's new austerity measures is still expected to proceed today.
The Dow rose 150.25, or 1.5 percent, to 10,058.64, its steepest percentage gain since Nov. 9. The broader Standard & Poor's 500 index rose 13.78, or 1.3 percent, to 1,070.52, while the Nasdaq composite index rose 24.82, or 1.2 percent, to 2,150.87.
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