Markets closed up today:
▲ Dow: +0.77 percent
▲ Nasdaq: +0.54 percent
▲ S&P: +0.65 percent
▲ Gold: up +0.05 percent to $1,670.18 an ounce
▲ Silver: up +0.47 percent to settle at $30.76
▼ Oil: -0.22 percent
Markets were up because:
The stock market keeps getting tossed around by the Fed.
Stocks opened lower Friday but reversed course after a letter surfaced from Federal Reserve Chairman Ben Bernanke suggesting there was room for the central bank to do more to help the economy.
"There is scope for further action by the Federal Reserve to ease financial conditions and strengthen the recovery," Bernanke wrote to California Rep. Darrell Issa, a Republican, in a letter obtained by The Wall Street Journal.
The Dow Jones industrial average was down 30 points at its low but finished 100.51 points higher, at 13,157.97, its first gain all week. It was still the first losing week for the Dow since early July.
The Standard & Poor's 500 index rose 9.05 to 1,411.13 but also snapped a six-week winning streak. The Nasdaq composite index rose 16.39 to 3,069.79, ending five straight weeks of gains.
In a typically slow August, without much else to influence trading, investors have grasped for hints about what the Fed might do.
The Fed has several options, including buying bonds, as it has done twice since the 2008 financial crisis, to try to lower interest rates and drive investors into the stock market.
Still, it's debatable how much future Fed action would help the market or the economy. On Friday, some analysts thought it strange that the market moved so decisively on just an inkling about what the Fed chairman might be thinking.
For the most part, the market has been hard to read this month. Without much news, trading volume has been low, and investors haven't had much conviction either way about the economy.
Of 18 trading days in August, only once has the Dow moved more than 1 percent. On five days, it has been virtually flat, moving less than one-tenth of a percentage point.
The turbulence likely lies ahead. The Fed's annual meeting in Jackson Hole, Wyo., is at the end of the month. German courts are set to decide next month whether the country can keep participating in bailouts for weaker European countries.
And the presidential election in November, which will help determine whether taxes go up and government spending is cut next year, could throw the markets into turmoil for weeks beforehand.
Economic reports that have trickled out this week have been mixed at best.
Europe, though quiet, still showed signs of tension Friday. Britain reported that its economy shrank in the second quarter, the latest confirmation that the country is still in recession.
Durable goods orders, reported by the Commerce Department, rose in July but fell after excluding gains from the volatile transportation category. Durable goods are an important measure of economic health because those orders show whether businesses are willing to spend to expand or improve.
The Associated Press contributed to this report.