Oil and Regulations: Market Headwinds and Tailwinds to Watch For

Even as oil prices held at $105 a barrel on Tuesday, the uncertainty of the commodity's price remains the “800-pound gorilla,” which will determine which way the market heads and how much growth is in store, said Jimmy Lee, managing partner of Strategic Wealth Associates.

“Oil is a big factor,” Lee told CNBC Tuesday. “It’s going to have a big effect in how corporate earnings play out in the 3rd and 4th quarters.”

Brian Jacobsen, chief portfolio strategist at Wells Fargo, agreed that oil prices could rise, but he maintained that it may well be a temporary spike and have a lesser impact. “Once some of the unrest does indeed clear up, we could indeed see commodity prices begin to decline,” he said.

Jacobsen said that even before tension broke out in Egypt and Tunisia, the cost of commodities, excluding precious metals, had dropped.

Both men see strong corporate profits as market tailwinds, and Lee noted that that prosperity could lead to job creation.

One drag to the market, added Jacobsen, could be applying capital controls to emerging markets.

“It’s a very good way to kill growth,” said Jacobsen. “That could be very disruptive to regional economies.”

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Disclosure information was not available for Lee, Jacobsen or their respective companies.