* Knight secures funds for rescue, shares tumble
* Cognizant shares jump after results
* Best Buy shares rally on founder's offer to purchase
* Indexes up: Dow 0.5 pct, S&P 0.5 pct, Nasdaq 0.6 pct
By Rodrigo Campos
NEW YORK, Aug 6 (Reuters) - U.S. stocks hit a three-month high on Monday as traders bet last week's plans from the European Central Bank to lower borrowing costs in Spain and Italy would work, adding to the bullish bias following last week's strong U.S. jobs report.
The S&P 500 faces an important technical hurdle as it trades at its highest since early May and near the 1,400 level.
The euro was flat after recent steep gains against the U.S. dollar as caution remained about how effective the action pledged by the ECB would be.
Inspectors from the International Monetary Fund, the European Commission and the ECB concluded a visit to Greece on Sunday saying the talks with the new coalition government were productive.
Wall Street rallied on Friday with the S&P 500 closing its fourth straight week of gains on a strong U.S. jobs report and renewed hope European authorities would act to contain the euro zone crisis through ECB purchases of Italian and Spanish bonds.
Monday's advance is "follow-through with a little bit of relief that (ECB President Mario) Draghi's remarks point to at least a work-around for Europe."
"People are more encouraged the economic slowdown in the U.S. may have reached a plateau," he added, regarding Friday's payrolls report.
A group of investors will rescue embattled market maker Knight Capital Group Inc in a $400 million deal that keeps the company in business, Knight said on Monday, but comes at a huge cost to investors. Knight shares fell 27.2 percent to $2.95.
The Dow Jones industrial average rose 68.11 points, or 0.52 percent, to 13,164.28. The S&P 500 Index gained 7.07 points, or 0.51 percent, to 1,398.06. The Nasdaq Composite added 17.45 points, or 0.59 percent, to 2,985.35.
Best Buy shares jumped 18.5 percent to $20.90 after founder and former Chairman Richard Schulze offered to buy the shares he does not already own in the electronics retailer for $24 to $26 each.
Cognizant Technology Solutions Corp shares rose 10.9 percent to $64.16 after the information technology services provider raised its full-year adjusted profit forecast.