In a semi-annual report presented to the Senate's Banking, Housing and Urban Affairs Committee in Washington, Bernanke said, "risks to economic growth have increased."
The Labor Department said consumer prices were unchanged May to June, a sign the recovery has stalled. The National Association of Home Builders, however, said builder confidence had risen to its highest level in nearly a decade in July.
Stocks reversed early losses in New York with the Dow Jones industrial average closing with a gain of 78.33 points, 0.62 percent, at 12,805.54. The Nasdaq composite added 13.10 points or 0.45 percent to 2,910.04. The Standard & Poor's 500 index was up 10.03 points or 0.45 percent to 1,363.73.
On the New York Stock Exchange, 2,044 stocks advanced and 988 declined on a volume of 3.4 billion shares traded.
The benchmark 10-year U.S. treasury note fell 10/32 to yield 1.508 percent.
The euro rose to $1.229 against the U.S. dollar from Monday's $1.2272. Against the yen, the dollar rose to 79.08 from Monday's 78.86.
In Japan, the Nikkei 225 index added 0.35 percent, 30.88, to 8,755.
In London, the FTSE 100 index shed 0.59 percent, 33.34, to 5,629.09.
2014: The Year in Music [PHOTOS]