(Reuters) - U.S. stocks rose in choppy trading on Thursday as a Greek vote over a euro-zone bailout was put into question, with sentiment also lifted after the European Central Bank unexpectedly cut interest rates.

Equities' trading was volatile as Mario Draghi, in his first news conference as ECB president, also said the euro zone could slip back into a "mild recession" by the end of the year.

Greek Prime Minister George Papandreou's government teetered on the brink of collapse and was ready to hold talks with the opposition on demands for a caretaker government. That threw into doubt plans for a referendum on staying in the euro zone. The vote threatened last week's long-awaited agreement to cut Greek debt and strengthen a euro zone rescue fund.

"The situation with Greece is coming to a head and while Greece may or may not be able to come to terms with the rest of the euro zone ... a resolution on that story will be good for the markets," said Sasha Kostadinov, portfolio manager at Shaker Investments in Cleveland.

The Dow Jones industrial average jumped 120.94 points, or 1.02 percent, at 11,956.98. The Standard & Poor's 500 Index added 9.46 points, or 0.76 percent, at 1,247.36. The Nasdaq Composite Index rose 21.20 points, or 0.80 percent, at 2,661.18.

The European Central Bank cut its main interest rate by 25 basis points to 1.25 percent as the euro zone's worsening debt crisis outweighed the concern over persistently high inflation, boosting risk appetite.

Pressuring stocks lower, many top U.S. store chains reported disappointing October sales, indicating consumers were still anxious about the state of the economy.

The S&P retail index fell 1.1 percent.

(Reporting by Rodrigo Campos; editing by Jeffrey Benkoe)

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