Morgan Stanley Dean Witter & Co. shares rose as much as 7.9% Wednesday on rumors the company was in talks to merge with Chase Manhattan Corp.

Morgan closed at $91.625, up $2.25. Chase gained $2.5625, to close at $79.375. Both companies declined to comment on the speculation, which appeared to lift shares of other major brokerages.

The action came as financial markets reacted positively to news that the Federal Reserve Board's Federal Open Market Committee, meeting in Washington, left interest rates unchanged. The Dow Jones industrial average gained 92.69, to 9366.82.

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