Shares of J.P. Morgan & Co. jumped $2.8125, to $122, on Friday after an influential analyst listed the banking company among possible merger targets for Chase Manhattan Corp.

Thomas H. Hanley of Warburg Dillon Read said Morgan would offer "the smoothest integration" with Chase because of their complementary operations.

Speculation about prospective partners for Chase, the one major banking company that didn't make a deal last year, is a popular topic for analysts. Chase has said it would consider deals that would benefit its shareholders.

Chase shares finished the day at $88, off 18.75 cents.

Mr. Hanley discussed the possible combination in a report to clients. A spokesman for J.P. Morgan declined to comment.

Morgan's stock rose steadily last week, driven by rumors about its teaming with another well-capitalized banking company in the United States or Europe.

Separately, Morgan disclosed in its proxy statement that chief executive Douglas A. Warner 3d got $7.4 million in compensation last year, a 1.9% decline, as operations suffered losses connected with trading in overseas securities.

Mr. Warner got a base salary of $700,000, a bonus and restricted stock award of $2.35 million, and options to buy 125,000 shares of Morgan stock, worth $4.36 million, the proxy stated.

In his report, Mr. Hanley also cited BankBoston Corp. as a potential partner for Chase. BankBoston gained $1.125, to $47.

Among brokerage firms, he said, Merrill Lynch & Co. and Donaldson, Lufkin & Jenrette Securities Corp. could fit.

Teaming with Merrill or Donaldson would cause the most concern among investors "due to cultural differences between the banking company and the brokerage," Mr. Hanley said.

Spokespeople for the companies either declined to comment or did not return calls requesting comment.

Meanwhile, the Dow Jones industrial average retreated a bit further from the 10,000 level on earnings warnings from the technology sector.

The Dow finished the day at 9,873.86, off 0.22%, and the Standard & Poor's bank index was off 0.51%. The Nasdaq bank index dipped 0.28%, and the S&P 500 0.24%.

Among banking companies, shares of Union Planters rose 62.5 cents, to $46.3125.

The company is "a great undiscovered story," asserted Alan Morel, banking analyst at J.J. Hilliard, W.L. Lyon in Louisville, Ky.

"Investors look at the stock and they say 'no way' because every year its true earnings potential is masked by the expenses of its growth process, which is acquisitions," Mr. Morel said.

Indeed, Union Planters tallied 19 acquisitions last year. But Mr. Morel said the company "is doing all the right things with these deals; they have a terrific track record."

Union Planters "brings its acquisitions on line and makes them as profitable as the company," he said.

Shares of Mercantile Bankshares in Baltimore are also worth a look, according to analyst Anthony J. Polini of Advest Inc. The stock closed Friday at $39.5625, off 31.25 cents.

Mercantile "has generated some of the industry's best performance ratios by embracing the concept that banking is a relationship-oriented business," he said. "Each affiliate bank is dedicated to its particular market area and empowered to respond directly to its customers' needs."

Mercantile's community banking strategy has demonstrated "truly remarkable" success, Mr. Polini said.

During the next two years, he said, he expects Mercantile to deliver record profits, increased returns on assets and equity, improved operating efficiency, strong credit quality and capital ratios, and fewer shares outstanding.

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