NEW YORK — A promise by European leaders to help Greece avoid default sent stocks sharply higher Wednesday for the third straight day.
The leaders of Greece, France and Germany agreed in a teleconference that Greece was an “integral” part of the 17-country bloc that uses the euro. Greece also said it would stick to agreements to trim its debts, a condition for getting more financial help.
The statements were intended to calm fears that Greece was headed for default or might be forced to drop the euro.
The Dow Jones industrial average rose 140.88 points, or 1.3 percent, to close at 11,246.73. The Dow sank as many as 112 points within the first hour of trading, then rose steadily through the rest of the day.
“The news out of Europe is beginning to sound a bit more friendly,” said Peter Cardillo, chief market economist at Rockwell Global Capital, a brokerage in New York. Investors remain far from convinced that Europe’s debt crisis will be solved. “Once they are, some of this fear will dissipate.”
The Standard & Poor’s 500 rose 15.81 points, or 1.3 percent, to 1,188.68. The Nasdaq composite rose 40.40, or 1.6 percent, to 2,572.55.
The threat of a Greek default and the damage it could wreak on financial markets has had investors on edge in the past two weeks, lifting Treasurys and weighing on stocks. The yield on the 10-year Treasury note hit a record low Monday of 1.87 percent, and the S&P 500 has risen only three days this month.
Uri Landesman, president of the New York hedge fund Platinum Partners, said investors have overreacted.
“They’re just not going to let them go under,” he said. “That’s just not happening. I think people have learned the lesson from letting Lehman Brothers fail.”
All three stock indexes are still down for the month. The Dow has lost 3.2 percent, and the S&P 500 lost 2.5 percent. The Nasdaq has fared better, losing just 0.3 percent.
