Two words are on the mind of every investor looking toward another week in this turbulent stock market: Obama and McCain.

With most major companies' earnings out of the way, and the market already discounting weak economic reports, the elections will be the primary focus next week.

Should the Democratic nominee, Illinois Sen. Barack Obama, win, Wall Street will be anticipating higher taxes on businesses and the wealthy. Republican nominee Sen. John McCain of Arizona, meanwhile, wants to lower the capital gains tax and make permanent President Bush's tax cuts for the rich. In recent weeks, most polls have shown Obama with the lead.

Greg Womack, a financial planner and president of Womack Investment Advisers, predicts that only an unexpected turn of events will have a major effect on prices.

"The markets have already factored in an Obama victory at this point," Womack notes. "What would significantly move the markets to the upside would be a McCain surprise -- a come-from-behind win or if the Republicans could pull off winning the majority seats in Congress or the Senate."

On the other hand, research by John Dorfman, portfolio manager of the Dorfman Value Fund, shows that, after an election, the market has generally responded positively in the past 15 election years, regardless of which party wins. The past 15 election-year Novembers had an average return of 14.5%, with eight posting positive returns, and seven turning negative.

December is even brighter, with 16.2% gains on average. Twelve of the months had gains and three declined. The results "very slightly" favor Democrats, says Dorfman, but there is ultimately little difference in who wins.

"People are glad to have the election decided and have that uncertainty taken out of the market," he says. "I think the election will be dominant next week, and it will be a good influence, but the other things could be bad influences."

Those factors, according to Dorfman, will be auto-sales reports on Monday, factory-orders data on Tuesday, and employment figures over the following three days. If recent economic trends are any indication, good news from any of those reports might be in short supply.

But, as Womack notes, in today's market, expectations are everything. Investors are not questioning whether the economic outlook is bad, but

how

bad -- and how long the downturn will last.

The

Dow Jones Industrial Average

closed the week up 11%, jumping 943 points to 9322, surging nearly 900 points on Tuesday alone. The market discounted a slew of mostly negative economic news, including a sharp decline in consumer spending and sentiment, higher mortgage rates and a 0.3% drop in economic output last quarter.

Several factors have contributed to the relatively bullish sentiment of the last few sessions. Among them, bargain hunters have started to dip their toes back into the market, as values of even large, stable household names plunged. While no one can say for sure, the forced liquidation of hedge funds seems to have abated somewhat, just as retail investors and institutional funds have begun to come off the sidelines.

"We've had a buyer's strike here," says Robert Bacarella, president and portfolio manager of the Monetta Fund. "Actually, a combination of sellers and a buyer's strike. But that could be behind us."

Bacarella is one of the bargain hunters. He has used a "funnel approach" to whittle down the number of stocks in the portfolio by about one-third, adding to his positions in names such as

Apple

(AAPL) - Get Report

, which has plunged from about $200 at the start of the year to just above $100 today on concerns about the health of the U.S. consumer.

"We always want to buy something on sale, right?" he says. "Well, it's on sale. If you don't want to buy here, you shouldn't be in the market at all."

Still, the trend of consumers saving rather than spending, especially on discretionary items, may have dire consequences for the economy, which is heavily reliant on consumer purchasing.

While most major names have already released earnings reports, investors searching for clues about the health of the consumer or industrial sectors will be able to collect more data next week.

MasterCard

(MA) - Get Report

reports on Monday;

ArcelorMittal

(MT) - Get Report

,

Cisco

(CSCO) - Get Report

and

Time Warner

(TWX)

on Wednesday;

Walt Disney

(DIS) - Get Report

on Thursday; and

Ford

(F) - Get Report

and

Sprint Nextel

(S) - Get Report

on Friday.

Still, says Bacarella, "everything's going to take second place to the election."