PARIS — World markets treaded water on Wednesday as traders awaited details of a European plan to contain the sovereign debt crisis, restore confidence in the euro currency and avert another potential global recession.
The EU summit will consider plans to boost the €440 billion ($600 billion) bailout fund by offering government bond buyers insurance against possible losses and attracting capital from private investors and sovereign wealth funds.
It will also seek agreement on a plan to bolster Europe's ailing banks and to lighten Greece's debt load by having private creditors take bigger losses on its bonds.
Global stock markets have rallied this month on expectations European leaders would be able to reach a deal this week and prevent contagion from spreading from a possible Greek debt default.
Markets could drop sharply if European policymakers emerge from a summit later Wednesday without a credible plan.
Some experts say that if Europe's debt problems are not solved, market turmoil and a credit freeze-up similar to the one in 2008 following the fall of Lehman Brothers could result.
Particularly worrying is also the prospect that larger economies, like that of Italy, could lose the confidence of investors and need financial help. Italy would be too expensive for eurozone countries to bail out.
Italy's Premier Silvio Berlusconi reached an overnight deal with his allies in parliament on emergency growth measures demanded by the European Union, averting an immediate government crisis and giving fresh impetus to the EU summit.
Berlusconi and Northern League leader Umberto Bossi reached a compromise on raising Italy's pension age in late-night talks Tuesday, a point of disagreement that threatened Berlusconi's leadership. Berlusconi's majority in parliament needs the support of the Northern League to guarantee his policies.
Berlusconi plans to deliver a letter with Italy's emergency measures at the summit later Wednesday. A spokesman said the contents are reserved for the summit leaders, but Italian media reported that the measures include new infrastructure spending, with a push for more private investment for strategic projects, the privatization of public entities and property and simplifying rules for companies.
Ahead of the summit, Britain's FTSE 100 close up 0.5 percent at 5,553.24, while Germany's DAX slipped 0.5 percent to 6,016.07. France's CAC-40 ended 0.2 percent at 3,169.62.
Wall Street was slightly higher, with the Dow Jones industrials average 0.4 percent higher at 11,752.56 and the S&P 500 up 0.1 percent at 1,229.63.
In Asia, Japan's Nikkei 225 stock average fell 0.2 percent to close at 8,748.47 while Hong Kong's Hang Seng index added 0.5 percent to 19,066.54. South Korea's Kospi advanced 0.3 percent at 1,894.31.
In currencies, the dollar was at 76.05 yen, roughly unchanged from late Tuesday in New York. The euro edged down to $1.3826 from $1.3909.
Benchmark crude for December delivery was down $1.65 at $91.52 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose $1.90, or 2.1 percent, to settle at $93.17 in New York on Tuesday.
Alex Kennedy in Singapore and Fu Ting in Shanghai contributed to this article.