The 24-year-old midfielder has joined the club for the remainder of the season from Aston Villa.
Alan Pardew: "Stephen has shown over the past few seasons that he's a real top player, so we are really pleased to have got him until the end of the season.
"He can create chances for others and score goals himself, and we think he can be a big factor for us in the second part of this season.
"I think Stephen feels he can deliver more than he's shown at Villa so far, so he's got a point to prove and I believe we can reap the benefits of that."