The New York Times reported Britain would inject $64 billion into three banks that would end up partially nationalized. The German government proposed setting up a $671 billion financial market stabilization fund, CNNMoney reported. Eurozone leaders were also poised to announce a menu of alternatives for member nations, the Times said.

In late-morning trading, the Dow Jones industrial average was up 458.37 points or 5.42 percent to 8,909.56. The Standard & Poor's 500 climbed 52.83 or 5.88 percent to 952.05. The Nasdaq composite index gained 95.24 or 5.77 percent to 1,744.75.

The benchmark 10-year U.S. Treasury bond was unchanged, yielding 3.87 percent.

The dollar was mixed. The euro rose to $1.3591, compared to $1.3413 Friday. Against the Japanese yen, the dollar rose to 100.84 yen, up from 100.25 yen.

In Hong Kong, the Hang Seng index gained 10.24 percent to 16,312.16, up 1,515.29. The Tokyo market was closed for a holiday.

Fed rushes to approve Wachovia purchase WASHINGTON, Oct. 13 (UPI) -- The U.S. Federal Reserve Board said Monday it had approved the $12.2 billion purchase of Wachovia Corp. by Wells Fargo & Co.

The rushed approval follows Wachovia's application submitted to the New York Stock Exchange to bypass shareholder approval for the sale.

Wachovia's Audit Committee recommended skipping a shareholder vote because "the delay necessary in securing shareholder approval for the consummation of the stock issuance would seriously jeopardize the financial viability of Wachovia," the bank said.

Similarly, Wells Fargo said Friday it had submitted its application to the Federal Reserve Board and was looking for "expedited approval of the merger."

The Wells Fargo purchase trumped an earlier agreement with Citigroup, which filed a lawsuit claiming $60 billion in damages. After Wells Fargo emerged as the victor in out-of-court negotiations for the firm, Citigroup said it would continue to pursue the lawsuit.

Germany to bailout banks with $671 billion FRANKFURT, Germany, Oct. 13 (UPI) -- German Finance Minister Torsten Albig said Monday the government had proposed a $671 billion bailout plan for the nation's banks.

The plan was to create a "financial market stabilization fund," CNNMoney reported.

The fund would operate with caveat that the firms using the funds be "solvent companies," the government said.

But, the government said there might be exceptions.

"In exceptional cases, needy companies that are relevant to the (financial) system can be bolstered by the fund ... if this is linked with a clear prospect of restructuring," the government said.

Members of Germany's parliament are expected to take up proposal by the end of the week, CNNMoney said.

Morgan Stanley investment to be protected NEW YORK, Oct. 13 (UPI) -- U.S. officials are urging a Japanese bank to go ahead with its investment in Morgan Stanley, promising to protect the money, sources told The New York Times.

As part of the move, which emerged during weekend talks, the U.S Treasury Department would protect Japan's Mitsubishi UFJ Financial Group's $9 billion investment in the Wall Street firm, the report said quoting people involved in the talks.

Morgan Stanley wants such capital infusion to demonstrate its stability before customers and investors. If the deal goes through, Mitsubishi would end up with about 21 percent stake in Morgan Stanley.

Such a step is important to the U.S. government's effort to attract outside investors to revitalize the financial system, even as it thinks of acquiring ownership in banks, the report said.

The plan to protect the Japanese bank's investment would also encourage similar deals in the future.

The move comes at a time when many potential investors including sovereign wealth funds remain hesitant to invest in financial service institutions without knowing what the U.S. government plans to do, the report said.

The Times report said U.S. Treasury officials declined comment but noted a Morgan Stanley-Mitsubishi deal will be seen by investors as a sign of confidence in the bank's future.