Bernanke Goes to Washington in Coming Week

NEW YORK (TheStreet) -- The coming week will see earnings season continue to gain momentum, but the biggest news is likely to be Ben Bernanke climbing Capitol Hill.

The Federal Reserve chairman is slated to give his semi-annual report on monetary policy before Congress on Tuesday and Wednesday, and once again Wall Street will be parsing his words for hints that the central bank is willing to pony up some additional quantitative easing sooner rather than later.

"Bernanke's comments this week should provide some clarification on whether the continued run of weaker economic data since last month's FOMC meeting have raised the odds of additional monetary action at the next FOMC meeting that concludes on 1st August," wrote Paul Ashworth, chief U.S. economist at Capital Economics.

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The economist cited the ISM manufacturing index, which slipped to less than 50, and the poor June jobs report in particular.

Ashworth thinks Bernanke makes it clear the Fed is still leaning toward standing pat unless there is a serious downturn in the macro environment, such as Lehman-like event in Europe.

"We doubt that those most recent developments are enough alone, however, to persuade a majority of voting Fed members to give QE3 the green light," he wrote. "Even at slightly below the 50 mark that is supposed to separate expansion from contraction in the factory sector, the ISM manufacturing index is still at a level that historically has been consistent with GDP growth of between 1.0% and 1.5%."

The Dow Jones Industrial Average rose 204 points, or 1.62%, to close at 12,777. The blue-chip index snapped a six-day losing streak and managed to finish the week with a 0.04% gain. Year to date, the Dow is now up 4.6%.

The S&P 500 leapt 22 points, or 1.65%, to settle at 1357, snapping its own six-session losing streak. The S&P 500 closed the week up 0.17% and now sports a 7.9% advance for 2012.

The Nasdaq, which ended a five-day skid, surged 42 points, or 1.48%, to close at 2908. The tech-heavy index lost 1% for the week and is now up 11.6% year to date.