Oil prices bounced more than $1 to over $80 a barrel as Bernanke's testimony before a congressional committee buoyed hopes that low interest rates will spur the economy, despite bearish US crude inventory figures.
US Treasury prices rose on Bernanke's comments, which gave bond investors added relief after the Fed's surprise discount rate hike last week raised fears that an increase in the fed funds rate would happen sooner than initially thought.
The euro rose as high as $1.3626 at one point and last traded at $1.3570, up about 0.45 percent.
Shortly after midday, the Dow Jones Industrial Average was up 84.95 points, or 0.83 percent, at 10,367.36. The Standard & Poor's 500 Index was up 9.02 points, or 0.82 percent, at 1,103.62. The Nasdaq Composite Index was up 22.87 points, or 1.03 percent, at 2,236.31.
Sectors that were worst hit by Tuesday's sell-off rebounded to lead the way up, including financials and technology.
European shares also eked out gains on Bernanke's comments.
The FTSEurofirst 300 pan-European index of top shares closed up 0.2 percent to 1,013.66 points. Banks gained amid what is proving to be a generally positive reporting season for the sector.
"People are still nervous about financials, and the Greek and European solution," said Colin McLean, managing director at Scottish Value Management in Edinburgh. "And some of the resources shares may have peaked. And the key characteristic in the market is low volumes." Investors had taken a wait-and-see approach this week before Bernanke started his semiannual testimony on monetary policy and the state of the economy before the US House Financial Services Committee.
Benchmark 10-year Treasury notes, which were down 3/32 just before the new home sales report and Bernanke's testimony, were up 3/32 to yield 3.68 percent.
US crude for April traded up 83 cents to $79.69 by 12:46 EST (1746 GMT), while London ICE Brent gained 63 cents to trade at $77.88 a barrel.
On Tuesday, the American Petroleum Institute (API) said crude oil imports rose 1.2 million barrels per day (bpd) to 9.19 million bpd, while inventories fell 3.1 million barrels and refinery runs rose marginally to 80.8 percent of capacity.
A week-long refinery strike that threatened fuel supply in France and helped push up oil prices over the past week has ended, French oil major Total said.
Workers at five of Total's six French refineries voted to end their protest after Europe's biggest oil refiner pledged late on Tuesday not to shut or sell any plants apart from its Dunkirk site in the next five year, unions said.
Britain's largest oilfield, Buzzard, has started to increase output after maintenance cut production for more than a week.
