(Reuters) - Stocks continued to cut losses on Tuesday, with the Nasdaq Composite up 1 percent briefly after Federal Reserve Chairman Ben Bernanke said he was prepared to take more steps to help the fragile economic recovery.

The Dow Jones industrial average was down 112.91 points, or 1.06 percent, at 10,542.39. The Standard & Poor's 500 Index was down 4.99 points, or 0.45 percent, at 1,094.24. But the Nasdaq Composite Index was up 18.37 points, or 0.79 percent, at 2,354.20.

(Reporting by Rodrigo Campos; Editing by Jan Paschal)

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