Last week, more POSITIVE than NEGATIVE developments were announced but the stock market dropped, instead of rising. Something else affected the economic outlook and that was the price of OIL.

HERE IS WHAT CONCERNS THE STOCK MARKET: If oil were to remain between $90 and $100 this year, a roughly 20% markup from 2010 levels, overall economic growth could decline by 0.8 of a percentage point, estimates Vadim Zlotnikov, chief market strategist at AllianceBernstein. But growth in big-ticket spending is more sensitive to oil prices and could fall 5%. The U.S. economy can probably handle higher gas prices or higher mortgage rates—but not both, says Strategas Research economist Don Rissmiller. His rough rule of thumb: Risks of a downturn increase when the numerical sum of gasoline prices (currently below $4) and mortgage rates (approaching 5%) exceeds 10.