NEW YORK U.S. stocks rose on Wednesday, halting a three-day losing streak as oil's rise above $100 lifted energy shares and investors picked up recent underperformers.
Anxiety over the Greek debt crisis tempered stock market gains and pushed the euro to a record low against the Swiss franc. The euro also edged lower against the dollar and the yen.
Concerns over Europe's sovereign debt problems helped lift gold to three-week highs, while longer-dated U.S. and German government bonds dipped on reduced flows due to the gains in stocks.
"Investors are tired of selling the market, especially with commodities finding their feet," said Andrew Wilkinson, senior market analyst at Interactive Brokers Group in Greenwich, Connecticut.
Shares rose in Europe, led by banking stocks, but the problems in Greece and other debt-laden European countries cast a long shadow over markets.
Europe's policy options to avert a Greek debt default appeared to be dwindling quickly, fueling fears of a chain reaction affecting other heavily indebted countries in the 17-nation currency bloc.
"The growing consensus of an eventual technical default by Greece is contributing to uncertainty, which is increasingly undermining the euro," said Michael Woolfolk, senior currency strategist at BNY Mellon in New York.
Investors expect Athens, saddled by massive debts, to have difficulty implementing more austerity measures as the government's main opposition party opposes such a move.
"For now, there is euro demand around $1.40, but it's just a matter of time before it goes significantly lower," said Greg Salvaggio, vice president of trading at Tempus Consulting.
"What's happening in Europe is the beginning of a prolonged sovereign debt crisis that will play out this summer," he added. "Polls suggest 80 percent of Greeks oppose more austerity, so if the government forces the issue, it will fall," which could increase the risk of a debt default.
The euro was last down 0.1 percent at $1.4083, paring earlier losses after a slide halted at $1.4011.
It fell to a record low against the Swiss franc at 1.2270 francs, down about 1 percent from late Tuesday.
On Wall Street, Wednesday's thinly traded rally was not seen as strong enough to overcome worries about waning global demand.
The Dow Jones industrial average .DJI ended up 38.45 points, or 0.31 percent, at 12,394.66. The Standard & Poor's 500 Index .SPX added 4.19 points, or 0.32 percent, at 1,320.47. The Nasdaq Composite Index .IXIC was up 15.22 points, or 0.55 percent, at 2,761.38.
Energy shares gained on an unexpected drop in distillate stockpiles, which boosted heating oil futures. The S&P energy index .GSPE advanced 1.5 percent, by far the biggest percentage gainer among S&P 500 sectors.
Bespoke Investment Group said breadth in the S&P 500 was very close to extremely oversold levels and that it was a buying opportunity the last time those levels were reached, in March.
Despite that, further upside was seen as limited, given headwinds from Europe and the prospect of an environment without supportive monetary policy.
"There's a lot of listlessness given the euro-zone issues and the volatility both ways in commodities, which is unsettling," said Rob McIver, co-portfolio manager of the Jensen Portfolio in Portland, Oregon.
World stocks as measured by MSCI were up 0.3 percent while the pan-European FTSEurofirst index .FTEU3 of top shares rose 0.7 percent, with anxiety about the potential for further Greek contagion limiting gains.
Japan's Nikkei closed 0.6 percent lower, while Nikkei futures in Chicago ended at 9,485, compared with its Osaka close of 9,470.
In the oil market, U.S. data showing a drop in distillate inventories overshadowed worries over a pullback in gasoline demand. U.S. crude rose $1.73, or 1.74 percent, to settle at $101.32 a barrel, while July Brent crude was up 2 percent at $114.88.
"The core fundamentals in crude are not deteriorating. They are still pretty good," said Barry Knapp, head of U.S. portfolio strategy at Barclays Capital in New York.
Gold touched fresh three-week highs. Bullion priced in euros struck a record high on concerns about the impact of a possible debt default by Greece on other euro zone economies.
Spot gold was last bid at $1,524.49 an ounce, down from $1,525.75 in New York late on Tuesday. Earlier, it hit a three-week high of $1,532.10.
Appetite for stocks and commodities curbed the safe-haven demand for U.S. and German government bonds.
The 10-year Bund yield was just above the significant 3.0 percent level and could soon breach it, given the unresolved debt crisis.
The 10-year U.S. Treasury yield edged up to 3.13 percent. It was still within striking distance of its 200-day moving average of 3.09 percent, which if breached would signal a further rally for U.S. bonds.
(Additional reporting by Ryan Vlastelica, Wanfeng Zhou, Carole Vaporean and Gene Ramos in New York; Editing by Dan Grebler)