(By Salman - iStockAnalyst Writer)US Stocks finished with gains on Friday on signs that discussion on Treasury's bailout plan may be extended beyond Friday, over the weekend to reach a political consensus. Earlier, stocks opened deep in red on signs that talks may stall. Collapse of nation's largest thrift Washington Mutual also weighed upon market sentiments in the morning session.

The Dow Jones Industrial Average advanced 121.07 points (+1.1%), to 11,143.13. The Standard & Poor's 500 Index rose 4.09 points (+0.3%) to 1,213.27. However, Nasdaq Composite Index fell 3.23 points (-0.15%) to 2,183.34, as Technology shares retreated, led by Research In Motion (RIMM).

In a statement, President Bush said that House Republicans who are seeking a different version of the plan have a right to be heard, but he stressed that there is "no disagreement that something substantial needs to be done." "We need a rescue plan," Bush said. "We've got a big problem." Rep. Barney Frank, chairman of the House Financial Services Committee, said he expects an agreement on the rescue plan by Sunday. Senate Majority Leader Harry Reid, who controls the chamber's schedule, said he's prepared to extend the Senate's schedule past its current Friday adjournment date. Reid said that the rescue plan can be approved by Monday

J.P. Morgan Chase & Co. (JPM) shares rallied 11% after it purchased seized assets of Seattle based Washington Mutual Inc from regulators. The underwriter -- J.P. Morgan Securities Inc. -- also has a 30-day option to purchase approximately up to an additional 37.0 million shares to cover over-allotments. J.P Morgan was upgraded to ``neutral'' from ``underperform'' by Merrill Lynch & Co., which said the bank got a ``very attractive deal'' for WaMu. The takeover gives JPMorgan about $900 billion in deposits and 5,400 bank branches nationwide.

Late on Thursday, the Office of Thrift Supervision declared WaMu ``unsound'' after customers of WaMu withdrew $16.7 billion from accounts since Sept. 16. Earlier, WaMu's credit rating was slashed to junk by rating agency S&P. Its stock price has been battered in past few trading session as it faces a loss of $19 billion in mortgage loans. The thrift had put itself for sale last week, but it failed to find a suitable buyer. Shares of Washington Mutual Inc. (WM) tumbled 90.5% on Friday.

Bank of America Corp. increased 6.8% while Citigroup Inc. (C) advanced 3.8 percent to $20.15.

Wachovia Corp. (WB) lost 27% on reports that the bank is in early discussions with Citigroup (C), Wells Fargo & Co. (WFC) and Banco Santander SA (STD) for a possible merger.

Shares of Blackberry maker Research In Motion (RIMM) shed 27.5%, or $26.77, to $70.76 after it issued 3rd quarter earnings forecast, which fell short of analyst estimates.

iPhone maker Apple Inc (AAPL) retreated $3.69 or 2.8% to $128.24.

Shares of Microsoft Corp. (MSFT) increased 2.97% after was assigned AA+ long-term issuer default, senior unsecured revolving credit facility, and senior unsecured debt ratings by Fitch Ratings. The rating outlook is stable.

Accenture Ltd. (ACN) gained 6.4% after the company said that its fiscal fourth-quarter net income came in at $434.8 million, up 37% from a year earlier figure of $316.8 million. Net income per diluted share was 67 cents versus 50 cents. Net revenue rose 17% to $6 billion. New bookings for the quarter rose to $7.67 billion, a quarterly record.

Energy shares edged lower on Friday. Massey Energy Co. (MEE) slipped 8.6%, while Tesoro Corp. (TSO) fell 5%.

On the front of economic data, U.S. Department of Commerce revised real GDP for the second quarter to 2.8% annualized from the earlier estimate of 3.3%. Economists expected Q2 growth to be revised up to 3.4%. The Reuters/University of Michigan final index of household sentiment dropped to 70.3, after a reading of 73.1 in early September. The confidence index was estimated to fall to 70.8, according to the median estimate of economists.

European markets finished with hefty losses. UK FTSE closed at 5,088.47, down 108.55 points (-2.09%) from previous closing. German DAX and French CAC declined 1.77 % and 1.50% respectively.

Among Asian markets, in Tokyo, the Nikkei 225 Average dropped 0.9% at 11,893.16. In Hong Kong, the Hang Seng Index fell 1.3% to 18,682.09.

At Nymex, Crude Oil for November delivery settled at $106.89, down $1.13.

Dollar settled mixed. Though it gained against Euro, greenback finished weak against Yen and Pound.



Disclosure: Author does not own any of the stocks discussed here.