NEW YORK - US STOCKS opened higher on Monday on cautious trading amid hopes US President George W. Bush would order the rescue of US automakers from the brink of bankruptcy and ahead of an expected interest rate cut.

The Dow Jones Industrial Average rose 40.14 points (0.47 per cent) to 8,669.82 in opening trades and the Nasdaq composite was up 2.15 points (0.14 per cent) to 1,542.87.

The broad Standard & Poor's 500 was also 4.57 points (0.52 per cent) to 884.30.

Faced with the looming threat of bankruptcy, key US auto companies fretted on Monday while White House officials studied their sputtering finances but reported no moves toward a bailout.

Mr Bush, who has hinted the government could tap a massive federal rescue package to aid the automakers, said on the way from Iraq to Afghanistan that an agreement on how to remedy the carmakers? plight was not imminent.

'We believe President Bush will soon provide some TARP money to give Detroit at least some temporary bail-out money,' Wachovia Securities analyst Al Goldman, referring to the government?s Troubled Asset Relief Program (TARP).

He said the Federal Reserve meeting on Monday and Tuesday was 'widely expected to cut interest rates again and probably say something about future actions it is considering'.

'Momentum says we have a few more days up before some modest pullback after the FOMC meeting,' Mr Goldman said. -- AFP