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Think of it as a "crude awakening" this year for investors, as recovering oil prices boost the stock market. Since hitting a low of about $26 a barrel in mid-February, oil prices have surged more than 73% and now hover at $45. During the same period, the S&P 500 (SPY) has risen more than 18%.

The broader market's momentum will probably continue for the rest of the year, as long as the Federal Reserve doesn't hike interest rates before December, or other bad surprises shake investor confidence. Anything can happen, but right now the picture is positive and favors the bulls.

Valuations are still high but they've moderated to become less out of whack, affording more room for growth. The forward 12-month price-to-earnings (P/E) ratio for the S&P 500 now stands at 16.8. This P/E ratio is above the five-year average of 14.8, but it's not at nosebleed levels either.

For third-quarter corporate operating results, the S&P 500 is estimated to post a year-over-year earnings decline of 2.3%. That's ostensibly a weak number, but analysts are setting the bar low, just as they did for the second quarter. Many companies handily beat conservative estimates in the second quarter; conditions now indicate that the third quarter is likely to surprise on the upside as well.

The global economic recovery is frustratingly tepid but remains on track. The World Bank projects global gross domestic product (GDP) growth to hit 2.4% in 2016 and 2.8% in 2017. For the world's two largest economies, the United States and China, the bank projects GDP growth in 2016 of 1.9% and 6.7%, respectively. These GDP numbers aren't gangbusters but they're not terrible, either.

Although alloyed with nervousness, optimism pervades Wall Street. Traders have stopped fretting about "Brexit" and slowing growth in China, as ultra-low interest rates and durable economic growth lift their moods. Eighteen companies plan to launch initial public offerings this month and an additional 100 are getting ready, according to research firm Renaissance Capital.

Mergers and acquisitions also are perking up. One particularly significant deal announced this month was Bayer's (BAYRY) $66 billion bid for Monsanto (MON) , which would forge a massive conglomerate encompassing pharmaceuticals, health products and pesticides.

The upshot: Precarious but tangible conditions are in place for further capital appreciation in equities. The next time the Fed could conceivably raise rates is November, but the consensus among analysts is that Yellen and her cohorts won't raise rates until December, after the presidential election.

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Accordingly, Republican presidential nominee Donald Trump recently lambasted Yellen's dovish monetary policy for being "political" and biased in favor of the Democrats.

Seasoned market observers have dismissed Trump's anti-Yellen rhetoric as demagoguery. For her part, Yellen last week fired back at the former reality television star, saying "We do not discuss politics at our meetings" and insisting that the Fed's decisions are guided by economic data, not party favoritism.

In the week ahead, there's a crowded docket of economic data that should be of keen interest to Yellen and investors:

New Home Sales (Monday); S&P Case-Shiller Home Price Index, PMI Services Flash, Consumer Confidence (Tuesday); MBA Mortgage Applications, Durable Goods Orders, EIA Petroleum Status Report (Wednesday); U.S. GDP, Jobless Claims, Corporate Profits, Bloomberg Consumer Comfort Index, Pending Home Sales Index, EIA Natural Gas Report, and Janet Yellen speaks (Thursday); Personal Income and Outlays, Consumer Sentiment, and Baker Hughes (BHI) rig count (Friday).

Companies scheduled to report earnings this week include Cal-Maine Foods (CALM) , Carnival (CCL) , Thor Industries (THOR) , NIKE (NKE) , BlackBerry undefined , Pier 1 Imports (PIR) , Accenture (ACN) , ConAgra (CAG) , PepsiCo (PEP) , Paychex (PAYX) , Costco (COST) , and McCormick (MKC) .

PepsiCo and Costco are holdings in Jim Cramer's Action Alerts PLUS Charitable Trust Portfolio. Want to be alerted before Cramer buys or sells PEP and COST? Learn more now.


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John Persinos is an editorial manager and investment analyst at Investing Daily. At the time of publication, he owned none of the stocks mentioned. Persinos appears as a regular commentator on the financial television show "Small Cap Nation." Follow him on Twitter.