Photo:  Stan Honda / Getty Images / August 28, 2011)

Wall Street might have been miffed last week as the spotlight strayed as far west as Wyoming, where central bankers huddled to discuss monetary policy. But not so miffed that the market didn’t shake off a mild earthquake and incoming hurricane to post its first gain in five weeks.

Stocks’ 4.7% rebound came even without further monetary coddling from our benevolent Federal Reserve. In a much-anticipated speech Friday, Fed Chairman Ben Bernanke pledged to support our weakening economy but stopped short of promising yet another round of Treasury buying. This shifts the pressure to the administration to devise a longer-term solution for our structural debt problem, and by one count, the word “fiscal” appeared 15 more times in Bernanke’s speech than “monetary.” Stocks responded with a 1.5% gain on Friday to the decision to forgo a temporary monetary fix in search of a more sustainable fiscal cure.

With that, the stock market has rebounded 5.1% from its Aug. 8 low, after an 18% correction from its late-April peak. Economic data released last week were hardly inspiring: Orders for big-ticket items rose 4% in July from June, but sales of new homes fell for a fourth straight month, home prices slipped and unemployment claims increased. Yet stocks gained even as economists continued to trim their growth forecasts—a sign the market might have factored in much of the bad news. Bargain hunters were further emboldened when Apple shares (ticker: AAPL) held steady following the resignation of its visionary CEO Steve Jobs, and after Warren Buffett’s Berkshire Hathaway (BRK-A) invested $5 billion in Bank of America (BAC).

Will the Standard & Poor’s 500’s Aug. 8 low of 1119 remain the market’s low-water mark for 2011? Among the encouraging signs: While economic cues have been weak, consumer sentiment can’t seem to get much worse. Stocks have also become very cheap relative to bonds: The S&P’s dividend yield recently matched that of U.S. 10-year Treasuries, when the norm since 1981 has been for Treasuries to pay a yield 2.7 times richer, notes Ned Davis Research. On the other hand, readings among investment advisors haven’t yet reached the extreme pessimism seen at a selling climax. And assets in Rydex bull funds still amounted to 55.6% of all funds—compared to 50.5% or lower at market bottoms.

With stocks already anticipating a mild profit recession, traders will be on the lookout for signs that things are worse than expected. Yet plunging interest rates will encourage refinancing, and debt-service burdens will shrink, says Ned Davis’ consumer strategist Pat Tschosik. Retail gas prices have fallen 9% despite the summer driving season; jobs are being created (albeit slowly), and consumers’ net worth has risen in seven of the past eight quarters. But watch out for damage to the wealth effect among richer consumers should stocks or home prices fall further, or professional employment start to decline.

The Dow Jones Industrial Average had its best week in nearly two months when it ended last week up 467 points, or 4.3%, to 11,285. Nasdaq Composite Index jumped by 138, or 5.9%, to 2480, while the Russell 2000 index gained 40, or 6.2%, to 692(Source: Barrons Online).