NEW YORK - US STOCKS shot higher on Monday on rising confidence in governments' actions to combat the global financial crisis after a highly volatile week as investors scrambled to deal with frozen credit.

The Dow Jones Industrial Average leapt 107.20 points (1.21 per cent) to 8,959.42 in early trades.

The Nasdaq composite rose 24.99 points (1.46 per cent) to 1,736.28, while the broad Standard & Poor's 500 index climbed 10.80 points (1.15 per cent) to 951.35.

On Friday, the Dow shed 1.41 per cent, capping a see-saw week saw the blue-chip index gain 4.7 per cent after a horrific 18 per cent meltdown the prior week.

The Nasdaq composite lost 0.37 per cent and the S&P 500 index slipped 0.62 per cent.

Analysts said sentiment was boosted after the United States and the European Union decided over the weekend to hold a series of summits to strengthen the international financial system, with the first meeting expected next month.

But they said investors remained cautious about the impact of the global credit crunch, which was showing early signs of easing.

'There isn't much rhyme or reason for the upward bias, other than the hopeful sense that the market is near a bottom and that all of the government action will succeed in easing the stresses in the credit market,' said Mr Patrick O'Hare, analyst at Briefing.com.

'The attention continues to fall on the financial dealings and the behavior of the market itself, which has been as unruly as ever in terms of its trading demeanor,' he said.

'Unfortunately, there is no indication at this point that the volatility is going to die down in meaningful fashion.' -- AFP