Update (11 a.m. EDT): MarketWatch reports stocks bounced after Bernanke's speech, at which he offered no stimulus from the U.S. Federal Reserve Bank. "More stimulus would have riled investors into thinking that things are actually worse than we see," Keith Springer, president of Springer Financial Advisors, told writer Kate Gibson. Shortly before 11 a.m., the markets were up across the board, Gibson reported: "After falling more than 200 points, the Dow Jones Industrial Average climbed 26.90 points to 11,176.72. The Standard & Poor’s 500 Index rose 7.37 points to 1,166.64, with utilities hardest hit and technology faring best among its 10 industry groups. The Nasdaq Composite Index gained 38.26 points to 2,457.89."
U.S. stock markets opened down somewhat on Friday as Federal Reserve Chairman Ben Bernanke prepared to give a major economic address at a retreat for central bankers in Jackson Hole, Wyoming. According to MarketWatch, "the Dow Jones Industrial Average declined 66.56 points to 11,083.26. The Standard & Poor's 500 Index fell 5.21 points to 1,154.06. The Nasdaq Composite Index dropped 1.95 points to 2,417.68."
The attention of the financial world will turn to Jackson Hole at 10 a.m. Friday, as Bernanke addresses the conference of bankers. In 2010, he revealed at the same event his plan for a second round of so-called quantitative easing (dubbed QE2). But Reuters reports he's unlikely to propose a third round of asset purchases.
Bernanke, however, is unlikely to announce a third round of Fed bond buying. The Fed has already bought $2.3 trillion in longer-term securities -- a policy known as quantitative easing. Its most recent program, dubbed QE2, ended in June.
But he is likely to acknowledge the economy's strains and may show a willingness to take other, relatively modest, steps to shore up the recovery.
"If people in the marketplace think he's going to announce QE3, they're going to be disappointed," said Bank of America Chief Economist Mickey Levy, speaking in the lobby of the Jackson Lake Lodge, where the annual retreat is being held.
Bernanke's speech comes alongside news on Friday that the U.S. Department of Commerce has revised the gross domestic product downward to 1 percent from 1.3 percent. That means that while the United States is not technically in a recession, growth is returning so slowly it almost feels like one.