US Stocks Advance As Greece Scuttles Referendum, ECB Cuts Rates

U.S. stocks advanced Thursday, after Greece shelved plans for a financial-bailout referendum and the European Central Bank announced a surprise interest-rate cut.

The Dow Jones Industrial Average rose 208.43 points, or 1.8%, to 12044.47, closing near session highs, after bouncing from early triple-digit gains to barely positive and back again during the session. It was the blue-chip Dow's second straight gain and eighth rise in eleven days.

The Standard & Poor's 500-stock index added 23.25 points, or 1.9%, to 1261.15, and the technology-oriented Nasdaq Composite rose 57.99 points, or 2.2%, to 2697.97. All blue-chip stocks rose, as did all S&P 500 sectors.

The gains came as Greece's prime minister scrambled to restore political stability by jettisoning a referendum that investors feared would undo the heavily indebted government's bailout package. The move coupled with the ECB's unexpected interest-rate cut and glimmers of strength in U.S. economic reports, including a slight drop in U.S. jobless claims last week, to drive stocks higher on both sides of the Atlantic.

"As the exogenous risk of Greece and European debt steps aside, modest U.S. economic growth and the strong earning story can shine through," said Stephen Wood, chief market strategist at Russell Investments.

Energy, industrial and technology stocks were the S&P 500's strongest sectors, while utilities, health care and consumer staples, three areas often considered defensive, showed the smallest gains.

European stocks reversed early losses; the Stoxx Europe 600 ended up 2.1% and Germany's DAX surged 2.8%. Asian bourses finished mostly lower amid uncertainty over euro-zone issues.

Front-month Nymex crude oil for December delivery gained $1.56 per barrel, or 1.69% to $94.07, the second straight gain. Front-month Comex gold for November delivery gained $35.50 per troy ounce, or 2.05%, to $1764.20.

Yield on 10-year Treasurys rose 0.058 percentage points to 2.065%, also a second straight gain, and the price fell 17/32 to 100 17/32.

Kraft Foods was one of the strongest blue-chip stocks, advancing $1.14, or 3.3%, to 35.78, after third-quarter earnings and revenue exceeded expectations. The company also raised its full-year outlook.

Jefferies Group was a focal point of euro-zone worries. A sharp morning decline in the stock triggered market circuit breakers amid fears about its exposure to Europe's sovereign-debt woes, which prompted a company statement that Jefferies had "no meaningful net exposure" as of Aug. 31. Shares finished down 26 cents, or 2.1%, at 12.01, after plunging as much as 20% earlier in the session.

Estee Lauder was the top stock in the S&P 500, rallying 18.09, or 18%, to 118.92, after the beauty-products company declared a 2-for-1 split of its common stock, effective Jan. 20, and increased its annual dividend by 40% to $1.05 a share. In addition, the company's fiscal first-quarter results beat estimates and the full-year outlook was raised.

Abercrombie & Fitch was the S&P's biggest decliner, slumping 14.75, or 20%, to 59.26, after the retailer said it is seeing a "slowing trend" in Europe, including falling same-store sales at flagship locations.

Kellogg lost 4.13, or 7.6%, to 49.91, after the company reported weaker-than-expected third-quarter sales growth. The company also lowered profit projections.

Qualcomm jumped 3.93, or 7.5%, to 56.11, after the chip maker reported better-than-expected fiscal fourth-quarter results and provided an upbeat outlook for this quarter.

Eastman Kodak declined 8 cents, or 6.7%, to 1.12, after reporting a wider third-quarter loss. The company also said it expected a deeper full-year loss from continuing operations and lower-than-anticipated revenue.

Limited Brands lost 26 cents, or 0.6%, to 42.96, after the apparel retailer's October same-store sales growth undershot expectations, offsetting an increased fiscal third-quarter earnings view.

Fair Isaac soared 6.81, or 25%, to 33.99, after posting an increase in fiscal fourth-quarter revenue. The credit-scoring company also projected fiscal 2012 per-share earnings above analysts expectations.

Strayer Education leapt 12.18, or 15%, to 90.84, after the for-profit education beat Wall Street's third-quarter earnings expectations, also announcing a $100 million stock buyback.

-By Brendan Conway, Dow Jones Newswires; [phone]; [e-mail]