The CBOE Volatility Index, known as the VIX or Wall Street's fear gauge, fell 4.6 percent
"It's a contest right now between the improving economy and fears about Greece," Brad McMillan, chief investment officer of Massachusetts-based Commonwealth Financial Network, told Bloomberg. "The economy really is improving and the first quarter was not the end of the world, but Greece is the big thing people are watching in the short-term."
The International Monetary Fund, one of Greece's key creditors, left negotiations in Brussels and flown home citing major differences with Athens. The Greek delegation also left as European Union President Donald Tusk warned Greek Prime Minister Alexis Tsipras that he was gambling with his country's future by refusing to compromise on terms including cuts to pension payments.
Greece has 1.6 billion euros of debt coming due at the end of the month and needs bailout funds.
"There are major differences between us in most key areas," IMF spokesman Gerry Rice said. "There has been no progress in narrowing these differences recently and thus we are well away from an agreement."
The UK's FTSE 100 rose 0.2 percent, while Germany's DAX 30 climbed 0.6 percent and France's CAC 40 rising 0.7 percent. The pan-European FTSEurofirst 300 index closed up 0.59 percent.
Crude oil prices fell after two days of gains, as the greenback gained against the euro on disappointment over stalled Greek talks, lifting the price of commodities denominated in US dollars.
Brent crude fell about 1 percent to US$65.11 a barrel, having touched as low as US$64.50a barrel.
News Corp shares fell 0.6 percent to US$14.56 on news that Rupert Murdoch is preparing to step down as chief executive of 21st Century Fox in favour of son James while Murdoch's older son would become co-executive chairman.
Fox, which was split from News Corp in 2013, owns film, cable and broadcast businesses and is controlled by the Murdochs through a family trust.
Meanwhile, online retailer Amazon gained 0.8 percent to US$434.17. The European Union said it has begun an antitrust investigation into Amazon over its distribution of e-books and contracts with publishers.
The EU regulators are also looking into low tax arrangements at Amazon, Apple and Starbucks and Fiat Chrysler. Reuters reported the investigations centre on Luxembourg's tax rulings for Amazon and Fiat Chrysler, Starbucks' tax arrangements in the Netherlands and Apple's method of routing earnings through its Irish business.