For the second day in a row, Federal Reserve Chairman Alan Greenspan told a congressional committee that the economic recovery is deepening and that interest rates will have to rise at some point, though he didn’t say when.

"As I have noted previously, the federal funds rate must rise at some point to prevent pressures on price inflation from eventually emerging," Green-span told the Joint Economic Committee today.

Similar testimony by Greenspan to the Senate Banking Committee yesterday led to a sharp sell-off in stocks.

The major indexes moved in and out of positive territory as investors also vacillated. According to preliminary calculations, the Dow Jones industrial average was up 2.77, or 0.03 percent, at 10,317.27 after falling more than 120 points yesterday.

The broader gauges were helped by Motorola. The Nasdaq composite index rose 17.00, or 0.9 percent, to 1,995.63. The Standard & Poor’s 500 index was up 5.97, or 0.5 percent, at 1,127.12.

The mood on Wall Street has become so foul that investors who for months sought a strengthening economy and higher earnings are now selling despite many signs of economic and corporate health. Since the government issued a higher-than-expected consumer price report a week ago, the stock market has been fixated on the prospect of higher interest rates — and become even more uneasy this week as Greenspan confirmed investors’ fears.

Most economists don’t expect the Fed to raise rates at its next meeting on May 4, but many believe rates will move higher by the end of the summer.

Richard E. Cripps, chief market strategist for Legg Mason in Baltimore, said he believed investors were overreacting.

"The reason interest rates are going up is for the right reason — the economy is stronger, and we’re starting to see it broadly domestically and synchronous globally. And that’s positive," Cripps said.

Still, Robert Christian, chief investment officer at Wilmington Trust Co., said he believed some investors hadn’t faced up to the reality of interest rate hikes before Greenspan’s latest testimony.