Stocks Open in Rebound Mode

Updated from 8:55 a.m. EDT

Stocks on Wall Street Friday opened higher ahead of a hotly anticipated congressional vote on the Treasury Department's rescue package for financial firms. A bank merger deal that will not require government assistance and an increasingly likely rate cut from the Federal Reserve were bolstering buying sentiment.

The Dow Jones Industrial Average climbed 100 points to 10,583, and the S&P 500 was better by 15 points at 1129. The Nasdaq added 33 points to 2010.

On Thursday, stocks finished with sharp losses as traders digested some bearish economic data and waited for signs that a $700 billion bailout package for the financial sector would pass the House of Representatives. The bill, slated to go before a vote Friday, is expected to pass the House by a narrow margin.

As investors awaited legislative aid, Wachovia ( WB) announced it has agreed to be sold to Wells Fargo ( WFC) in a $15.1 billion deal that Wells Fargo says will not require assistance from the Federal Deposit Insurance Corp. or any other government agency. The deal seems to negate another deal brokered by the FDIC Monday under which Citigroup ( C) agreed to acquire all of the banking subsidiaries of Wachovia.

Not all news from the financial sector was as rosy. Swiss bank UBS ( UBS) said it would cut 2,000 jobs as part of its reorganization efforts.

The Wall Street Journal reported that Washington Mutual CEO Alan Fishman won't stay on at JPMorgan Chase ( JPM), which acquired WaMu after it failed on Sept. 25.

In other board shakeups, mortgage packager Fannie Mae ( FNM) announced that former CEO Daniel Mudd will not be keeping his seat on Fannie's board.

Meanwhile, several media reports suggested that Japanese firm Mitsubishi UFJ ( MTU) may merge its investment banking unit with Morgan Stanley ( MS) operations in Japan.

Elsewhere, private equity firm Blackstone ( BX) bought a $600 million stake in China National BlueStar, according to a report by Bloomberg.

In the technology arena, Hewlett-Packard ( HPQ) may, according to a report in the Journal, be gearing up to release a smartphone.

As for economic data, the Department of Labor reported that the September unemployment rate remained at 6.1%, the same rate as in August and nonfarm payrolls decreased by 159,000, the largest drop since March 2003 and twice the decline feared by economists. The average work week declined to 33.6 hours from 33.7 in August.

The dismal employment numbers were spurring speculation that the Fed would soon cut its target interest rate. Futures markets were pricing in 100% odds of a rate cut before the Fed's next meeting on Oct. 29.

September services numbers from the Institute for Supply Management are due later this morning.

In commodities, crude oil was up 33 cents to $94.30. Gold was losing $7.90 to $836.40.

Longer-dated U.S. Treasury securities were slightly higher. The 10-year was adding 5/32 to yield 3.61%, and the 30-year was gaining 25/32, yielding 4.11%. The dollar was softening vs. the yen and edging higher against the euro and pound.

Across the seas, European exchanges, such as London's FTSE and Frankfurt's DAX, were largely trading higher. Asian indices like the Nikkei in Japan and Hong Kong's Hang Seng, meanwhile, closed with losses.

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