US Markets
U.S. equities rose after positive news from the labor and housing markets, then drifted higher on reports of progress toward a second bailout for Greece. The Dow Jones Industrial Average rose 115 points, or 0.9%, to 12896 in afternoon trade. Blue chips recovered Thursday after falling 97 points Wednesday, the Dow's worst session of the year, and were on pace to notch the highest close since May 2008.

The Standard & Poor's 500-stock index rose 13 points, or 1%, to 1356, and the Nasdaq Composite rose 39 points, or 1.4%, to 2955. All 10 sectors in the S&P 500 rose, and materials and technology stocks led the advance. Among Dow components, Microsoft gained 4.7% and Bank of America added 3.4%.

Stocks rose early after a full slate of U.S. economic data encouraged investors, then extended gains after a report from German newspaper Die Welt that national euro-zone central banks will swap Greek debt for new bonds by Monday, a move that removes one hurdle standing in the way of a second Greek bailout. The number of U.S. workers applying for unemployment benefits fell last week to the lowest level in nearly four years. Initial claims dropped by 13,000 to 348,000 last week.

Economists surveyed by Dow Jones Newswires expected claims to rise by 7,000, to a total of 365,000. The Federal Reserve Bank of Philadelphia reported that an index of business conditions for manufacturers in the mid-Atlantic region rose to 10.2 in February from 7.3 in January, slightly better than expectations for a reading of 10.0. Housing starts In January increased to an adjusted annual rate of 699,000, while economists had expected starts to total 677,000. Issuance of building permits for housing rose 0.7% in January, in line with expectations.


European Markets
European stocks fell Thursday as investors digested conflicting information about whether Greece will get its EUR130 billion loan tranche before its March 20 bond redemption payment becomes due, while the prospect of further downgrades for the region's banks weighed heavily on sentiment. The U.K.'s FTSE 100 index closed 0.1% lower at 5885.38. Germany's DAX fell 0.1% to 6751.96 and France's CAC-40 closed 0.1% higher at 3393.25.

Just to add more confusion to the session, the Stoxx 600 index slumped 10% in the last minute of trading. Due to technical issues, the closing value for the index has been delayed, the index publisher said. German Finance Minister Wolfgang Schaeuble expressed doubt Wednesday over whether the next Greek government would stay committed to the austerity measures, and the Greek Finance Minister Evangelos Venizelos said Europe's wealthier countries are playing with fire by toying with the idea of pushing Greece out of the euro zone.

Banks suffered the brunt of the selling after Moody's Investors Service placed various ratings of 114 financial institutions in 16 European countries on review for possible downgrade, pointing to banks' vulnerability to the euro-zone sovereign-debt crisis. Among those affected were Barclays, BNP Paribas, Commerzbank, Credit Agricole, Deutsche Bank, HSBC Holdings, ING Groep, Royal Bank of Scotland Group, Banco Santander, Societe Generale and UniCredit. Commerzbank AG lost 1.7%, while HSBC Holdings PLC lost 0.4%. However, Societe Generale managed to reverse earlier losses to trade up 0.8%, even though its fourth-quarter earnings failed to meet expectations.

Elsewhere, defense group BAE Systems fell 2.3% after reporting earnings before interest, taxes, amortization and impairment of intangible assets fell 7.1% in 2011. French insurer AXA's stock fell 1.3% after its full-year net profit came in below analysts' expectations despite rising 57%.

Asian Markets
Asian shares fell Thursday, as investors fretted about the possibility of a messy Greek default, although Japanese shares found some support from a relatively weak yen. South Korea's Kospi fell 1.4% to 1997.45, Hong Kong's Hang Seng Index lost 0.4% to 21,277.28, the Shanghai Composite Index also declined 0.4% to 2356.86 and Japan's Nikkei Stock Average declined 0.2% to 9238.10.

Several officials familiar with the negotiations said that some of Greece's euro-zone creditors were considering delaying Greece's full bailout package until after the country holds elections, expected to take place in April. At the same time, arrangements would be made to help the country avoid disorderly default. The relatively weak yen helped some major Japanese exporters add to their recent advance: Sharp Corp. climbed 1.1% and Sony Corp. rose 0.9%. However, Olympus Corp. lost 2.4% after the arrest of ex-chairman Tsuyoshi Kikukawa and other former executives Thursday in connection with the firm's accounting scandal.

Higher crude-oil prices helped lift Japan Petroleum Exploration Co. by 2.8%. Commodity-exposed firms were also weak in Hong Kong, with Jiangxi Copper Co. down 2.1% and Aluminum Corp. of China Ltd. down 2.8%. Resource focused conglomerate Citic Pacific Ltd. fell 2.3%, while Zijin Mining Group Co. fell 3%. China's central bank said Wednesday in its quarterly monetary-policy report that the country still faces the risk of slower growth and higher inflation and that it can't let its guard down against inflation risks. Banks trading lower in Hong Kong included Bank of China Ltd., down 1.5%, and HSBC Holdings PLC, off 0.6%.

Commodities
Base metals closed lower on the London Metal Exchange Thursday, although losses were pared somewhat late in the session after a raft of positive U.S. data deflected some concern about European sovereign debt. At the close, flagship three-month copper was 0.9% lower at $8,295 a metric ton. The red metal earlier hit a near-four-week-low at $8,205/ton after reports that euro-zone officials were considering a delay to all or part of Greece's second bailout package and news that Moody's Investors Service placed various ratings of 114 financial institutions in 16 European countries on review for possible downgrade.

Risk appetite lifted a tad later in the European trading session, however, after positive news from the U.S. labor and housing markets cheered investors. U.S. crude oil futures prices settled at a seven-week high Thursday, while North Sea Brent traded near an eight-month high as buyers scrambled to line up alternative supplies amid outages in Yemen, South Sudan and worries about near-term flows from Iran. Iran's threat to cut off crude supplies to Europe, well ahead of a European Union embargo this summer, has sent jitters through the market as refiners in the region look for alternative supplies.

Meantime, some Asian buyers, backing away from Iranian crude amid tightening sanctions in response to Iran's nuclear program, have been buying up other crudes favored by European refiners. Light, sweet crude oil for March delivery on the New York Mercantile Exchange settled at $102.31 a barrel, a seven-week high. ICE North Sea Brent crude for April settled at $120.11 a barrel, up $1.18, the highest since mid-June.

Gold futures clawed back earlier losses to end in positive territory as hopes for a successful Greek bailout were seen easing the risk of a credit crunch in the euro zone. The most actively traded contract, for April delivery, rose 30 cents to settle at $1,728.40 a troy ounce on the Comex division of the New York Mercantile Exchange.