Moving with lightning speed, key United States lawmakers announced agreement Wednesday on a US$789 billion economic stimulus measure designed to create millions of jobs in a nation reeling from recession. US President Barack Obama could sign the bill within days.

"The middle ground we've reached creates more jobs than the original Senate bill and costs less than the original House bill," said Senate Majority Leader Harry Reid, one of the participants in an exhausting and frenzied round of bargaining.

The bill includes help for victims of the recession in the form of unemployment benefits, food stamps, health coverage and more, as well as billions for states that face the prospect of making deep cuts in their own programmes.

Tax break provision

It also preserves Obama's signature tax cut - a break for millions of lower and middle income taxpayers, including those who don't earn enough to pay income taxes.

The stock market immediately bounded higher as Reid and other lawmakers held a news conference announcing the agreement.

Reid has said the legislation should create 3.5 million jobs. Senate Republican Susan Collins of Maine put the cost at US$789 billion. That is less than either of the bills that the House and Senate passed earlier.

The market's move higher comes a day after a steep selloff. Stocks have fluctuated throughout the session, and investors are hoping the stimulus plan will help revive spending.

The Dow was up 60 at 7,948, and the Standard & Poor's 500 index is up 6 at 833. The Nasdaq composite index is up 6 at 1,531.

Bankers vow reform

Earlier in the day, bankers also vowed to work for financial system reform. Facing a disgusted public and Congress, bank CEOs agreed with demands for greater accountability Wednesday in the first testimony on how they're spending money from the taxpayer-funded US$700 billion bailout.

"Both our firm and our industry have far to go to regain the trust of taxpayers, investors and public officials," John J. Mack, head of Morgan Stanley, told the House Financial Institutions Committee.

Added JP Morgan Chase and Co's Jamie Dimon: "We stand ready to do our part going forward."

The eight top bankers appearing before the panel were generally contrite and conceded they have work to do to win over a bitter public and an exasperated Congress.

They had little choice but to acknowledge as much, given intense anger and anxiety as the troubled financial system continues to spiral downward in an ever-worsening recession.

Taxpayers are furious with big banks that benefited from the federal bailout designed to get credit moving again, but which also spent lavishly on executive bonuses, company retreats and office redecorating.

Lawmakers also are feeling the heat for signing off on the bailout package plan, which was conceived last year under President Bush and now is in the hands of President Obama.

- AP