On-line brokerage stocks, buoyed by rising industrywide trading volume and optimism over interest rates, have had solid gains in the last two trading days.

Additional good news came Monday as Charles Schwab & Co. announced that its average daily revenue-generating trades, including its on-line and traditional trading activity, increased to 144,300 in October, up 10% from September and 43% from a year earlier.

The market extrapolated from that a bright outlook for most on-line brokerages.

Schwab's "October activity report painted a fairly rosy picture for on-line trading," said Michael A. Flanagan, an analyst for Financial Service Analytics Inc.

Ameritrade Group Inc. rose $4.50, to $26.4375; E-Trade Group $1.375, to $38.125; DLJdirect $1.25, to $19.50; and Charles Schwab 37.5 cents, to $43.25.

Schwab's report was issued Monday after big increases in most brokerage stocks Friday, partly spurred by a bullish report on brokerages from Hambrecht & Quist LLC.

Greg Smith, an analyst at Hambrecht, attributed the upswing in brokerage stocks to three factors. First, on-line brokerage stocks, like other financial stocks, had been hammered since April because investors were concerned about rising interest rates.

Second, the on-line firms have added "millions of accounts" since their stocks began their downturn.

And third, the Nasdaq overall index, having hit new highs in nine of 10 trading days through Friday, caught the attention of retail investors. As a result, trading volume for November is looking even better than for October.

Meanwhile, the recent success of several initial public offerings has added to retail investors' enthusiasm.

October "volumes were just amazing," Mr. Smith said. "Conditions were ripe for a rally; we have a return to the heightened euphoria we saw in January and April."

Indeed, on-line brokerages have been on a tear the last few weeks. Since Oct. 26, a Hambrecht & Quist Group index of six on-line trading stocks has increased 46%, to 1,829 by Friday's market close. That compares with a 11% increase in the Standard & Poor's bank stock index.

The Hambrecht & Quist index includes Ameritrade Holding Corp., E-Trade, Charles Schwab & Co., DLJdirect, TD Waterhouse Group Inc., and Knight/Trimark Group Inc.

Still, on-line brokerages have failed to recoup their Hambrecht & Quist index high on April 13 of 3,102. As of Friday it was down 41%. That compares with a drop of 5% in the S&P bank index.

On-line brokerages tend to be more volatile because it's a pure play in Internet trading, Mr. Smith said.

Analysts said a secondary reason for Monday's rise for on-line brokerages was the announcement by Charles Schwab, Ameritrade, and TD Waterhouse to join with three venture capital firms to form an on-line investment bank. The brokers will team up with Kleiner Perkens Caufield & Byers, Trident Capital, and Benchmark Capital to form a firm that will focus on underwriting equity offerings for information technology and Internet companies. Based in Silicon Valley, the company is expected to open next year.

In general trading, the American Banker index of the top 50 U.S. banks rose 0.3% to 645.4; the AB225 rose 0.6% to 880.8.

Among the largest banks, stocks were mixed. Gainers included Citigroup Inc. $1, to $55.875; Bank One Corp. $1.875, to $38.125; and First Union Corp. 31.25 cents, to $42.3125. Losing stocks included Bank of America Corp. 75 cents, to $65.75; Chase Manhattan Corp. $2.4375, to $82.5625; and J.P. Morgan & Co. 93.75 cents, to $138.375.

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