By Jonathan Cheng U.S. stocks saw a strong rally cut in half as investors braced for new risks in Europe and prepared for televised remarks by Federal Reserve Chairman Ben Bernanke. The Dow Jones Industrial Average gained 119 points, or 1%, to 11777 in afternoon trading. The Standard & Poor's 500-stock index added 12 points, or 1%, to 1230 while the Nasdaq Composite rose 13 points, or 0.5%, to 2620. The blue-chip Dow had gained as much as 219 points before paring back the gains in the afternoon. Even after pulling back, all 10 S&P 500 sectors remained in positive territory. The heavily-battered financial sector led the day's gains. Bank of America rose 3.5%, while American Express advanced 2.2% and J.P. Morgan Chase rose 1.8%. Wednesday's afternoon declines came after headlines suggested the European Union and International Monetary Fund could withhold further bailout money to Greece until a referendum is held. On Monday and Tuesday, the Dow had tumbled 573 points after Greek Prime Minister George Papandreou called for a referendum on the terms over a debt bailout for the troubled nation. "This is the market in a nutshell--you walk away for two minutes and the market can move dramatically," said Michael Marrale, head of U.S. sales trading at RBC Capital Markets. "Days like Monday and Tuesday are certainly not confidence-inspiring, but at this point, it goes with the territory. Increased volatility is the new normal." "Greece has really thrown us for a loop. We don't need extra uncertainty; there's enough out there as it is," said Tom Villalta, lead portfolio manager at the Jones/Villalta Opportunity Fund. Even so, Mr. Villalta called the pullback "one in a number of buying opportunities." "We believe that U.S. stocks are not decoupled from Europe's problems, but that the share-price declines aren't representative of what the overall impact is going to be." Meantime, the Fed, in its policy-setting meeting Wednesday, kept interest rates unchanged and appeared to show little movement toward further monetary easing, which some in the markets had expected. Even so, investors were awaiting comments from Mr. Bernanke, slated to begin at 2:15 p.m. EDT. Mr. Marrale of RBC said that investors had relatively limited expectations for more easing from the Fed, and instead found the central bank in a surprisingly positive state of mind. "The Fed's commentary reads well--they're more optimistic on their outlook for the economy," he said. Stocks were also helped by U.S. private-sector hiring, which came in slightly stronger than expected. Strong earnings reports were also in the mix, boosting energy and materials stocks after positive signals from EOG Resources and Pioneer Natural Resources. Alcoa gained 2.1%, Chevron rose 1.4% and Exxon Mobil climbed 1.1%. "Between yesterday's rumor rout and today's rumor rally, I think there's fundamental support below the markets. Earnings are like a warm blanket right now for the hyperventilating market," said David Waddell, president and chief investment strategist at Waddell & Associates in Memphis, Tenn. On Thursday, investors will hear from the European Central Bank's new president, Mario Draghi, and will keep a close eye on a meeting of the Group of 20 industrial and developing economies in Cannes, which Greek Prime Minister Papandreou is expected to attend. In overseas markets, European stocks pushed higher in volatile trading, with the Stoxx Europe 600 rising 0.9%. Germany's DAX index gained 2.3% and France's CAC-40 index advanced 1.4%. Asian bourses erased early losses to trade mostly higher. China's Shanghai Composite closing up 1.4% after being down 1.5% at its weakest point, while Hong Kong's Hang Seng Index gained 1.9%. But Japan's Nikkei Stock Average fell 2.2%. In economic news, Automatic Data Processing said the U.S. added 110,000 new private-sector jobs in October, a touch above expectations for 100,000 new jobs. The September number was revised upward to 116,000, bringing some cheer to the market ahead of Friday's closely watched monthly nonfarm payrolls report. Gold futures rose to about $1,730 an ounce, and crude-oil futures reversed morning gains to slip to just above $92 a barrel. The U.S. dollar lost ground against the euro and the yen. Treasurys fell, pushing the yield on the benchmark 10-year note up to 2.0117%. In corporate headlines, MasterCard surged 6.4%, putting its share price on track for a new record close, after the card company reported a 38% jump in third-quarter profit as spending and transactions made with its credit and debit cards increased. The company also posted a 27% increase in net revenue, which it derives primarily from processing transactions for banks. EOG Resources jumped 11% after its production of more-lucrative liquid fuels continued to surge. Pioneer Natural Resources gained 9.1% after third-quarter earnings more than tripled amid a bigger-than-expected revenue gain. JDS Uniphase climbed 6.9% after reporting better-than-expected fiscal first-quarter earnings and revenue, offsetting a lowered current-quarter revenue outlook because of the flooding in Thailand. Garmin rallied 4% after the satellite-navigation company reported better-than-expected third-quarter results and provided an upbeat outlook for the full year. Comcast added 0.5% as the cable company slowed defections in pay-TV subscribers for the fourth straight quarter. Time Warner shed 2.1% after third-quarter earnings and revenue topped forecasts. The media giant lifted its view on earnings growth for this year. Diamond Foods slumped 21% after the company said the closing of its $1.5 billion purchase of Procter & Gamble's Pringles business will be delayed until the first half of 2012. MF Global, which filed for bankruptcy protection on Monday, dropped 83% in heavy trading after its trading suspension was lifted.