Stocks higher, but volatile, after Bernanke speaks

Stocks gyrated after the Federal Reserve chairman spoke on Friday morning. They first gave up their morning gains, then bolted to their highs for the day, before settled in-between.

The Dow Jones industrial average ended the day up 90.13 points at 13,090.84.

A half-hour after trading began, Bernanke declared that the Fed is ready to take more action to help an economy that's "far from satisfactory."

Investors have been watching to see whether the Fed will buy more bonds to further lower long-term interest rates. Stocks fell initially, however, after it became clear that no such announcement was coming Friday and that Bernanke had stopped short of committing the Fed to any specific move.

Still, he said the Fed "should not rule out" new policies to improve the job market.

Stocks rebounded once investors parsed his comments. At one point the Dow was up as many as 151 points.

In terms of volatility, "it's been the most action we've seen in couple of weeks," said Ryan Larson, a senior equity trader at RBC Global Asset Management. He noted that pre-Labor Day volume was light, with many investors and traders on vacation, which can contribute to bigger price swings.

The Standard & Poor's 500 index closed up by 7.10 points at 1,406.58. The Nasdaq rose 18.25 points to close at 3,066.96.

The Dow finished the month of August up by 0.8 percent. The S&P 500 rose more than 2 percent for the month, and the Nasdaq rose more than 4 percent.

Investors looking for help from the Federal Reserve may only have one more chance before the election, said Frank Fantozzi, CEO of Planned Financial Services in Cleveland. The Fed's policy-making arm meets on Sept. 13. If it doesn't announce some form of stimulus then, it probably won't until after the election, he said.

"He's waiting until the last possible minute," Fantozzi said of Bernanke. "I think in the next two weeks they're going to really digest the economic data and say, 'Ok, do we get involved or not?'"

Bernanke's said at a Fed meeting in Jackson Hole, Wyo., that it's "probably not a coincidence" that stock prices have risen since March 2009, when the Fed first announced its plan to buy Treasuries and other securities. The Dow is up 77 percent since the 2009 announcement.