Greek debt rescue by EU appears likely

BRUSSELS - Wealthy European nations were moving closer toward swallowing a bitter pill Tuesday: rescuing Greece from its overspending before its debts drag down the euro and stock markets all the way to Wall Street.

Stocks in the United States and Europe rose on expectations of some kind of decisive action to prevent a Greek debt default that could spread to other countries, undermining Europe's hesitant economic recovery.

European Union leaders will issue a statement on Greece's debt crisis during a meeting Thursday, officials said - without giving details of what it would say. Markets reacted well to news that European Central Bank president Jean-Claude Trichet would make a rare appearance at the summit in Brussels - which they saw as confirmation that some kind of help would be discussed.

The crisis has exposed the EU's Achilles' heel - states remain independent to spend as they wish, but their decisions can affect all 16 eurozone nations. Countries that help Greece risk having their own borrowing costs rise, and could see other struggling euro zone economies get in line for aid.

Bernard Valero, a spokesman for France's foreign minister, said Tuesday that "we must help" Greece. Germany is also looking at ways to help Greece. - AP