Oil's down, stocks are up, but uncertainty remains

Investors are not sure yet, however, if it's a turnaround with staying power or just a temporary reversal.

Market bears would argue that economic readings are still weak, particularly for the average U.S. consumer. Other countries' economies are declining, too, and the credit markets that companies rely on to borrow and lend remain tight.

But on the more positive side, prices for commodities including oil are much lower than they were a month ago. The housing market, though probably not due for recovery anytime soon, is showing signs of bottoming. And the stock market tends to rebound before the economy does.

It's easy to argue both sides; it's harder for an investor to decide where to put his money. That's why many market analysts are predicting that stocks are going to stay volatile for a while longer.

Back-and-forth movements are typical when the market is trying to put in a bottom, said Scott Wren, equity strategist for Wachovia Securities. Plus, he said, "you're getting a lot of mixed news."

Last week, after seesawing, the Dow Jones industrial average finished down 0.63. The Standard & Poor's 500 index ended the week up 0.15 percent, and the Nasdaq composite index rose 1.59 percent.

This week, investors will keep monitoring the energy markets, and also see how the housing industry is faring in the National Association of Home Builder's index on Monday and the Commerce Department's Tuesday report on July new home construction.

At the same time, Wall Street will be gauging the financial health of consumers in the earnings reports of retailers including Home Depot Inc., Target Corp., Gap Inc. and BJ's Wholesale Club.

Consumers have been buying fewer items, in general, because prices have been rising. Last week, the Labor Department reported a hefty 0.8 percent increase in consumer prices for July.