It is conceivable, for example, that the current weakness in stock prices may already reflect the weak earnings news that will be released over the next several weeks and the stock market might unwind some of its excess pessimism,
Rita is a major factor, as it is expected to keep the dominant negative in place: high energy prices and their impact on both consumer spending and the animal spirits of U.S. businesses.
There is a revival in global growth now underway that is lifting the U.S. manufacturing sector and hence, commodity prices and wages.
If oil prices fall, it will help to stimulate economic activity -- the profit outlook will be better and also lower oil would bring down costs, making stocks the better asset class.
This just is a reflection of the current environment with oil prices rising, security concerns. All of these factors are pushing players to buy bonds over stocks.