Markets did a U-turn Friday after Federal Reserve Chairman Ben S. Bernanke indicated that the central bank wasn’t ready to take more action to stimulate the economy, falling sharply but then reversing course as the widely anticipated policy speech wrapped up.

The blue-chip Dow Jones industrial average was down as much as 1.8 percent a few minutes after Bernanke’s speech began at 10 a.m., while the Standard & Poor’s 500, a broader market measure, was down nearly 2 percent. The tech-heavy Nasdaq slid 1.4 percent.

Investors were also flocking to safe bets such as gold and U.S. Treasury bonds as they abandoned stock markets. Gold futures shot up about 1.3 percent to $1,782 shortly after Bernanke began speaking, while the yield on the 10-year Treasury bond fell to 2.13 percent, indicating that investors were willing to accept a smaller return in exchange for the safety of holding government debt.

Rather than hinting at an additional round of bond-buying, which would push more money into the banking system and help drive interest rates even lower, Bernanke merely reiterated that the Fed “has a range of tools that could be used to provide additional monetary stimulus” and would again weigh their merits at its September meeting.

But the speech also offered hints of optimism about the economy as a whole. Bernanke said “the growth fundamentals of the United States do not appear to have been permanently altered by the shocks of the past four years” and pointed to falling commodity prices and lower debt levels among households as two reasons why the broader economy might continue to grow.

Shortly before 11 a.m., markets pared their losses from the beginning of Bernanke’s speech and turned positive. The Dow was up 0.3 percent, while the S&P was up 0.6 percent. The tech-heavy Nasdaq surged 1.5 percent.

Markets in Europe also continued to mend their losses. Britain’s FTSE 100 was down about 0.8 percent in early afternoon trading Friday, after being down more than 1 percent before Bernanke’s speech. Germany’s DAX was down 1.4 percent from a previous fall of 2.2 percent, and the Euro Stoxx 50 index of blue-chip European stocks was down 1.8 percent, versus 2.25 percent previously.

Markets had surged Wednesday on widespread hopes that Bernanke would use a major policy speech this morning to indicate that the central bank is willing to take more action to prop up the economy. When he made the same address last year, Bernanke hinted that the Fed would initiate a second round of bond-buying as a means of putting money into the markets and lowering long-term interest rates.

Major stock indexes in the United States each gained more than 3 percent on hopes that he would give a similar indication Friday of a third round of bond buying. But markets seemed less sure of such action Thursday. The Dow slid 1.5 percent, the S&P lost 1.6 percent and the Nasdaq fell 1.9 percent.

U.S. markets also woke up Friday to a downward revision on the country’s already weak economic growth. The Commerce Department said it had revised its second-quarter estimate for growth in U.S. gross domestic product, the broadest measure of economic growth, down to 1 percent from an already anemic 1.3 percent. Decreased spending by state and local governments, shrinking private investment and increased imports all hurt the GDP more than previously thought.

Oil futures slid about 2 percent in early trading Friday to $83.62 per barrel.

Bank of America, which soared Thursday after the announcement of a $5 billion investment from famed billionaire investor Warren Buffett, resumed its tumble Friday. Shares of the Charlotte, N.C.-based banking giant slid about 0.8 percent in early trading to $7.59 per share.