"I made a list of all the good things and all the bad things that are affecting the stock market," a trader said the other day. "And the only thing on the good side of the list was that all the bad stuff was expected."

Recession. War in the Middle East. Ground war in the Middle East. Problems in the Soviet Union. Shaky banking system. Consumer confidence at a 10-year low and sinking. Layoffs. Lousy corporate profits.

After falling sharply in the first weeks of 1991, the stock market has managed to rebound nicely since the war in the Persian Gulf began in mid-January. Why has it rallied? Nobody really knows.

What is bothering many of the experts is that the stock market has staged these mystery rallies before, and they turned out to be traps. In 1987, for instance, stock prices were soaring inexplicably before they crashed. And in early 1990, stocks rose nicely (again without explanation) in January before going on to a horrible tailspin.

"It makes no sense. We actually have some clashes with our soldiers killed on the ground and yet the {stock} market is up," said a bewildered trader during last Wednesday's big rally. "It doesn't make sense to me."

If you think hard enough you can come up with an explanation for the market's recent buoyancy. There's this one: The war couldn't end until it began, so it's good that it finally started. And this: Stocks start to rebound halfway into a recession. Since the recession is probably already at least six months old, we are now midway through the typical downturn. And lastly, this explanation: The stock market always reacts positively to lower interest rates.

The last explanation makes sense. The only potential problem is that it appears the Federal Reserve is having trouble getting people and corporations to borrow money (and banks to lend), even though it has been sharply driving down interest rates.

The other two explanations are not good reasons to buy stocks. The war could have a severe detrimental effect on the nation's economy, so its start could be one of the worst things that could have happened as far as the equities market is concerned. And picking the mid-point of a recession, as in explanation No. 2, is about as easy as picking the correct lottery numbers.

Some experts are worried that, like in 1987 and 1990, there is nothing fundamentally sound about how the stock market is reacting these days.

"It's all technical," said William King, an independent trader in Chicago. He said the market's recent strength appears to have its roots in the index futures and options markets in Chicago. "Trading programs are pushing the market up. The one fundamental {factor} working for the market is that some people believe the economy has bottomed."

The theory that the economy is about to turn upward is a flimsy one. One executive at a major U.S. corporation recently said that he saw no sign that business conditions were improving. And, aside from the money being spent on the Persian Gulf War, government economic indicators aren't pointing to any improvement either.

When Wall Street decides to begin looking at the bad side of the list, stock prices could take another beating. People who have been caught before in traps laid by technical traders are watching where they step these days.

Are U.S. oil refiners about to experience prosperity or suffer pain?

If you look at the action of stocks like Diamond Shamrock, Tosco and Valero Energy recently, you'd have to bet on prosperity. These shares have been rising since the Middle East war resulted in -- amazingly -- lower oil prices.

The betting among people who are investing in these shares is that, barring any unforeseen developments in the war, oil prices ultimately could fall into the low teens after the gulf war is over. Alan Gaines of Gaines Berland Inc., which specializes in energy stocks, thinks the profit picture for this country's handful of refining companies is very bright.

Buying refining stocks right now is a little like betting on the war. For one thing, these shares could do even better if refineries in the Middle East are blown up by Iraq.

Because it is unlikely that any new refineries will be built in this country because of tough environmental laws, the optimists say the existing refining companies could become very valuable.

But that opinion is far from universal. Those who don't share such a rosy outlook say investors who have been diving into refining stocks in recent days are forgetting to take one thing into account -- the recession.

John Hilton, an analyst at Argus Research, expects demand for home heating oil and gasoline to decline 3 percent during the current recession because of the economic slowdown.

That, he said, could put pressure on the profits of refiners and make their stock a bad investment.

The folks who manage equity mutual funds in this country are good at picking stocks, but bad at determining when the whole market will rise or fall.

A new study just released by the University of Dayton offers this advice to money-managers: Don't try to time the market. Stick to searching for undervalued companies.

Carl Chen, who conducted the study, said "managers of only five out of the 93 funds which we studied do a good job of market-timing, while 23 show inferior timing performance."

The findings say managers of larger funds and funds that charge a high fee tend to be the worst market-timers. But these same funds have proven to be better stock pickers.

Chen concludes that portfolio managers should not try to outguess the market. They should just keep picking stocks. John Crudele is a columnist for the New York Post.