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Record high oil prices didn't mean much last week to stock investors, who sent the market up even as crude came within a hair of striking $50 a barrel.

If traders are right, the blinders will remain on for another week.

"I think there'll be a bit of follow-through strength next week," said Dave Briggs, head of trading at Federated Investors.

The

S&P 500

ended the week up 3.1% at 1098 and the

Nasdaq

jumped 4.6% at 1838. The

Dow

gained almost 3% at 10,110. Meanwhile, crude oil for September delivery rose almost 3% for the week, closing at $47.86 a barrel.

The sentiment in the stock market right now is that current oil prices are not sustainable, according to Briggs. "A lot of investors feel that they'll stop going up and maybe correct, or at least stay in a trading range for a while."

Many oil traders seem to disagree. According to a

Bloomberg

survey, 63% of traders said they expect oil futures to climb further next week as concerns mount over potential supply disruptions. Fighting in Iraq and threats that oil fields could be torched have fueled the gains in oil prices recently, and Russia's tax battle with its largest oil producer, Yukos, continues to hang over the market. The Organization of Petroleum Exporting Countries is pumping close to full capacity to prevent shortages.

"I've been very impressed with the

stock market's resiliency in the face of higher oil prices," said Tom Schrader, a trader at Legg Mason. "I'm going to say we'll continue our upward bias, albeit on very light volume."

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One reason traders have grown more bullish on the market's prospects recently is because various surveys have shown an increase in bearish sentiment, which is considered a contrarian indicator, in this case a bullish one.

The Investors Intelligence survey showed that bearish sentiment rose to 28.7% in the latest week from 24.2%. The number of bulls fell to 43.6% from 48.4%. A recent poll by the American Association of Individual Investors also found that bullish sentiment declined, although bearish sentiment fell, too.

A number of analysts have also stressed that the market is cheap, although Smith Barney analyst Tobias Levkovich points out that on a price-to-sales basis, the S&P 500 has never been more expensive.

In any event, analysts say it's hard to time the market based on valuation. Indeed, stocks can stay cheap or expensive for a long time.

While a decline in oil prices next week would certainly give some investors a reason to cheer, high energy costs haven't been the sole reason for investor caution over the past two months. Concerns that tax relief is fading, that interest rates are on the rise, that the job market has been slowing down and that earnings growth is decelerating have also added to the gloomy tone.

"There's more to the stock market's summer swoon than high oil prices," Levkovich said.

Even if oil prices fell 15% from current levels, they would remain at levels that can and probably will hurt economic growth. And the data for August will almost certainly reflect the recent jump in oil, which could spark another leg down for equities.

In the week ahead, the economic calendar is fairly light, but data on home sales, durable goods orders for July and the revision to second-quarter gross domestic product could have some impact.

Durable goods orders are expected to rise 1% in July after a 0.9% increase in June. Meanwhile, second-quarter GDP is expected to be revised down to 2.8% from 3.0%, reflecting some disappointing trade data.

The Michigan consumer sentiment survey for August could also influence trade on Friday, although most investors will be focusing on a speech by

Federal Reserve

Chairman Alan Greenspan at the Kansas City Fed Symposium in Jackson Hole, Wyo.

Analysts and investors will be listening closely to hear whether the Fed chief is as optimistic on the economy as he has been in other recent speeches. When the Fed raised interest rates on Aug. 10, it said the economy is "poised to resume a stronger pace of expansion going forward."

While most of the focus will be on oil and economic news next week, a few companies are due to release earnings, including

H&R Block

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,

Toll Brothers

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and

Williams-Sonoma

(WSM) - Get Williams-Sonoma, Inc. Report

.

The second-quarter earnings season produced gains of more than 25% for the S&P 500, but estimates for the third quarter have not been increasing at the same rate as in recent quarters, and forecasts for the fourth quarter and 2005 are starting to come down.