US stocks rose on Thursday after two days of declines as Morgan Stanley and Goldman Sachs shares shot up following upbeat quarterly results, while blockbuster results from TSMC boosted shares of US chipmakers.

Goldman Sachs and Morgan Stanley both reported a rise in quarterly profit, helped by a flurry of dealmaking. Shares of Goldman rose 4.6 percent, giving the Dow its biggest boost, and Morgan Stanley gained 5.8 percent.

Earlier this week, other banks reported mixed results that weighed on the sector, along with worries about US President Donald Trump's proposed one-year cap that would limit credit-card interest rates to 10 percent.

Investors are still buying stocks that are undervalued compared with tech, said Jake Dollarhide, chief executive officer of Longbow Asset Management in Tulsa, Oklahoma.

"It's been growth, tech or bust in this market," in recent years, he said. Today, "it's the banks and old-school industrials" that are standouts. The S&P 500 industrials index notched a closing record high again.

Tech stocks also rose, led by chipmakers. The world's main producer of advanced artificial intelligence chips, TSMC, predicted robust annual growth and flagged more US manufacturing capacity was in the works. US-listed shares of TSMC jumped 4.4 percent.

An index of semiconductors climbed 1.8 percent. Shares of Nvidia, Broadcom and chipmaking tool company Applied Materials all climbed.

The S&P 500 rose 0.3 percent, to 6,944, the Dow rose 0.6 percent, to 49,442, while the Nasdaq rose 0.2 percent, to 23,530.

Among other financial companies, BlackRock, the world's largest asset manager, gained 5.9 percent after a rally in markets lifted fee income and pushed its assets under management to a record US$14.04 trillion in the fourth quarter.

Results from the banks essentially have kicked off the fourth-quarter US earnings season. The season picks up steam next week with a more diverse group of companies set to report. (Reuters)