Architects of a $700 billion bailout plan urged US lawmakers to act swiftly or face dire economic consequences amid growing concern the rescue may be delayed, but markets were heartened by news that Warren Buffett was investing $5 billion in Goldman Sachs.

Warren Buffett's Berkshire Hathaway Inc will invest $5 billion in Goldman Sachs Group Inc , in a major boost for the Wall Street bank from perhaps the world's best-known investor.

In Tokyo, Kyodo news agency reported that Sumitomo Mitsui Financial Group, Japan's third-largest bank, also plans to invest several billion dollars in Goldman, with which it has a long relationship.

'It's a vote of confidence which is gold plated,' said Michael Holland, a money manager at Holland & Co in New York. 'You don't get better than this.'    

Shares of Goldman rose 8.1 percent after the announcement, while Standard & Poor's 500 futures gained 15 points.

Goldman also announced plans to sell $2.5 billion of common stock.

Buffett is adding Goldman to a portfolio of investments at Berkshire that includes large stakes in a handful of major US commercial banks.

On Sunday, Goldman won Federal Reserve approval to become a bank holding company, giving it easier access to financing and adding to speculation it might buy another bank.

This came after many investors questioned its business model amid this month's market turmoil, causing shares to fall 50 percent from their record set last Oct 31.

'Goldman Sachs is an exceptional institution,' Buffett said in a statement. 'It has an unrivaled global franchise, a proven and deep management team and the intellectual and financial capital to continue its track record of outperformance.'    

Buffett is the second-richest American according to Forbes magazine, and built Berkshire into a $199 billion conglomerate by investing in undervalued companies with strong management.

He was not available for immediate comment, according to Debbie Bosanek, who works in his Omaha, Nebraska office.

Lloyd Blankfein, Goldman's chief executive, in a statement noted Buffett's 'longstanding relationship' with the company, and called the investment 'a strong validation of our client franchise and future prospects. This investment will further bolster our strong capitalization and liquidity position.' -Reuters