Stocks surge after Italy passes economic reforms

NEW YORK (AP) ? Stocks are surging, erasing their losses for the week, after Italy and Greece moved closer to forming new governments and getting their financial crises under control.

The Dow Jones industrial average rose back above 12,000.

Italy’s benchmark stock index leapt 3.7 percent and its borrowing costs plunged after the country’s Senate passed a crucial austerity budget demanded by the European Union.

In Greece, Lucas Papademos, a former central banker, was sworn in as interim prime minister.

The Dow Jones industrial average jumped 267 points to 12,161 at midday Friday. It closed below 12,000 the previous two days.

The S&P 500 rose 25, or 2.2 percent, to 1,264. Both the S&P 500 and the Dow are on track for weekly gains.

The Nasdaq rose 55, or 2.1 percent, to 2,680.