Also, the European Central Bank's latest monthly policy meeting and rate decision as well as Spain's bond auction take place on Thursday. Meanwhile, many analysts are already looking ahead to next week, when Alcoa ( AA) is slated to kick off third-quarter reporting season on July 9.

"You're seeing companies already coming in and bringing expectations down, which could mean that more corporations have the ability to beat their estimates," said Quincy Krosby, market strategist with Prudential Financial.

The FTSE in London settled up 1.25% and the DAX in Germany finished with a 1.24% gain. Hong Kong's Hang Seng index was closed for the day. The Nikkei in Japan closed down 0.04%.

August crude oil futures settled down $1.21 at $83.75 a barrel. August gold futures shed $6.50 to settle at $1,597.90 an ounce.

At last check, the benchmark 10-year Treasury was up 18/32, diluting the yield to 1.593%, while the greenback was up 0.34%, according to the dollar index.

In corporate news, Bristol-Myers Squibb ( BMY) is purchasing diabetes drugmaker Amylin Pharmaceuticals ( AMLN) in a deal valued at about $7 billion. Amylin shares jumped nearly 9%.

Dell ( DELL) shares fell 1% after the PC giant announced its acquisition of software specialist Quest Software ( QSFT ) for $2.4 billion.

Shares of Barclays ( BCS) added more than 4% after the company announced the resignation of Marcus Agius as chairman.

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