Despite Friday’s gains, equities look to end the week little changed.
Markets have advanced in recent months, buoyed by expectations for more help from the Fed. Thursday's retreat could indicate that the market is now less vulnerable for a sell-off, though financial market participants were cautious ahead of the Fed speech. St. Louis Fed President James Bullard told Bloomberg TV that policymakers should wait and consider more economic data before making any big policy moves.
Investors are also looking ahead to a meeting of the European Central Bank next Thursday that is expected to take pressure off highly indebted countries. Comments from European Central Bank Executive Board member Benoit Coeure rekindled expectations for central bank action.
Sectors tied to the pace of economic growth, including energy and financials, are likely to be impacted the most by Bernanke's remarks. Defensive groups like utilities or health care may have a more muted reaction.
In the week to date, the S&P has dropped 0.8 percent, though the index barely budged over the first three sessions of the week - declining just 0.05 percent. The Dow is down 1.2 percent for the week and the Nasdaq is off 0.7 percent.
Turnover has been paltry, with this week's four days so far being among the five lowest in terms of volume this year.
Economic data over the past two weeks has been a little stronger than expected, and Reuters polls show investors and economists are more skeptical that the Fed will announce a new round of bond buying at its September meeting.
In company news, Google Inc Chief Executive Larry Page and Apple CEO Tim Cook have been conducting behind-the-scenes talks about a range of intellectual property matters, including the mobile patent disputes between the companies, people familiar with the matter said.
Science Applications International Corp said late Thursday it plans to split into two independently traded companies to bid for more contracts which they cannot do now due to conflict-of-interest regulations.
Intellpuke: This article is a compilation of reporting by NBC News and Reuters correspondents, you can read it in context here: marketday.nbcnews.com/_news/2012/08/31/13589656-stocks-rally-as-investors-monitor-fed-chiefs-speech?lite