Push for action in euro zone fuels gains

US stocks rose 1 percent in a third day of gains on Wednesday after European leaders displayed new urgency in efforts to contain the euro zone debt crisis.

The Dow Jones industrial average was up 140.88 points, or 1.27 percent, at 11,246.73. The Standard & Poor's 500 Index was up 15.81 points, or 1.35 percent, at 1,188.68. The Nasdaq Composite Index was up 40.40 points, or 1.60 percent, at 2,572.55.

Global equities and the euro gained as optimism over tentative steps to resolve Europe's debt crisis overcame still widespread fears that Greece will ultimately default on its debt.

Comments by Europe's top bureaucrat that plans for a common euro zone bond, seen by many as a key tool to ease the region's debt crisis, would soon be presented gave equity markets on both sides of the Atlantic and the euro an early boost.

Creation of such a bond would give the weaker countries in the euro zone access to cheaper funds, although Germany has consistently opposed such a move.

The pan-European FTSEurofirst 300 index of top shares closed up 1.4 percent at 913.22, while stocks on Wall Street gained more than 1 percent in afternoon trade.

The Nikkei average skidded more than 1 percent on to a fresh 2-1/2 year closing low, as persistent worries about the European debt crisis raised fears of more losses ahead and prompted investors to take profits on the previous session's gains.

The benchmark Nikkei ended down 1.1 percent at 8,518.57, its lowest close since 8,493.77 marked on April 28, 2009. The broader Topix index dropped 1.1 percent to 741.69.