ZURICH, Oct 2, 2008 (AFP) - Swiss banking shares rose Thursday, lifted by the US senate approval of a rescue package aimed at averting a financial meltdown, but market players warned that the rally may be short-lived.

At 11:51 am (0951 GMT), stocks of Credit Suisse jumped 5.42 percent to 54.45 Swiss francs, while Julius Baer was up 3.82 percent to 52.95 francs.

UBS shares also surged 9.04 percent to 21.48 francs, thanks mainly to the bank's announcement earlier Thursday that it would swing into profit in the third quarter following successive quarters of losses.

'The overall gain in financials today has to do with the rescue package. The rally could go a bit further in financials, and the broad market should also gain out of relief,' a Zurich-based trader told AFP.

He warned however, that the rally could be short-lived.

'The risk of a recession is still very high. After this current rally, fear of recession is likely to return to haunt the markets,' he added.

Bank Vontobel's analyst Joerg Salzman also noted that the US bailout decision would 'calm the situation.'

'For investors, the situation remains grim,' he added, however. 'The market is anticipating an economic cooldown,' he wrote in a note to investors.