NEW YORK (CNN/Money) - The Easter Bunny. Santa Claus. The Loch Ness monster. The stock market closing higher this year.

What do they all have in common? They're all figments of your imagination. Or are they?

Stocks have fallen for two years in a row in the United States, and after one of the most dismal quarters in market history ended Monday, they may be set for strike three. The last time that happened was the three years ended in 1941, during World War II.

So with three quarters of 2002 history, the stock market has just one quarter left to come back. Can it be done?

Most market analysts interviewed for this story were skeptical. Extremely so. In fact, one was so sure that stocks won't close in the black this year that he offered to buy this writer a bottle of Dom Perignon if they do.

Granted, the scenario seems ridiculous.

Even after Tuesday's rally, the Dow is still down 24.2 percent for the year while the Nasdaq is down 39.9 percent. The S&P: down 29 percent. Stocks would need an unbelievable rally to close higher.

And in fact, the major indexes have made bigger jumps than that in the past. So who knows? If the stars align and everything falls into place, there is the slimmest of chances it could happen again.

According to market researchers the Hirsch Organization and Ned Davis Research, the Dow soared 77.1 percent in the second quarter of 1933 and 67.0 percent in the third quarter of 1932, in the midst of the Great Depression, after the stock market crash of Oct. 24, 1929. The S&P 500 index gained 82.39 percent and 86.50 percent in those same quarters and years.

The Dow also rallied 24.7 percent and the S&P 500 21.59 percent in the first quarter of 1975, six months after the resignation of Richard Nixon following the Watergate scandal of the early 1970s.

But more recently, in the fourth quarter of 2001, the Nasdaq rallied 30.1 percent as investors dug in, even amid a recession, after the tremendous selloff that followed the terrorist attacks of Sept. 11.

So hypothetically, what might it take for markets to close up for 2002?

Concerns about a potential war with Iraq, its impact on the economy, the war on terrorism and global oil prices all have been factors in the sharp selling of late.

All the analysts surveyed for this story agreed that a resolution with Iraq would be necessary for markets to rally substantially -- and investors showed they agreed Tuesday as blue chips soared after news that Iraq agreed to terms for the return of weapons inspectors.

But a more apt catalyst perhaps would be a quick attack and the removal of Saddam Hussein from power, said Donald Selkin, director of research at Joseph Stevens. "Then we might have a repeat of 1991 with the Persian Gulf War, where you have a quick war, the guy's power is stymied, oil continues to flow and stocks rally."

Stocks will be able to rally substantially if and when the attacks begin, but that may not be enough, said Ned Riley, chief investment strategist at State Street Global Advisors.

"To really get the kind of enthusiasm that would erase the losses for the year, we'd need to see Saddam dead and confirmation of Osama bin Laden's death, which is widely suspected," Riley said. "That in turn would bring the price of oil down and could boost consumer confidence."

However, any attack probably wouldn't even happen until January, so that would prevent the possibility of rallying by the end of the year, Joseph Stevens' Selkin added.

On another front -- corporate profits -- for the fourth quarter, analysts are predicting earnings growth of a little over 20 percent from a year earlier, according to earnings tracker First Call. While 20 percent is nothing to sneer at, that's a substantially more conservative figure than had been forecast earlier in the year.

"Markets are so focused on earnings. We really need half a dozen big, brandname behemoths, -- someone like an Intel, a General Motors or a General Electric -- to stand up and talk loud, to step forward and say that their balance sheets are fine, that business is picking up, that they will meet or beat earnings estimates," said Ram Kolluri, chief investment officer at GlobalValue Investors. "That's the key."

You need to see some signs of a turnaround in business confidence and in particular, a turnaround in technology spending, said State Street's Riley, with stronger orders, particularly for chip equipment and telecom gear.

"To get a big recovery, you need a big tech recovery. The indexes can't move higher without tech leading on a fundamental and stock basis," he added. "If telecom cleans up a lot of its issues, that would help, too."

Even just the suggestion of improving profits might be enough to get markets started, the analysts said.

"There is the possibility that some of these big companies have been biding their time and could spring a few positive surprises towards the end of the quarter," GlobalValue's Kolluri said.

The Federal Reserve also could provide some fuel. The central bank's target for its fed funds overnight bank lending rate currently stands at 1.75 percent, the lowest in about 40 years. But a surprise interest rate cut, in between meetings, might get markets rallying.

"Stocks rose sharply after the Fed cuts in the first quarter of 2001," said Michael Carty, principal at New Millennium Advisors. "So Fed action now could help."

Too often, the Fed has come across as being behind the curve, said Joseph Stevens' Selkin. Even after 11 interest rate cuts last year, some analysts said, the Fed seemed to be following the market and the economy, rather than anticipating what was happening.

A risk could be that investors take a rate cut as a sign that the economy is even worse than people had believed.

On Tuesday, economic data on manufacturing activity and construction spending showed further declines amid a general slowdown in those sectors of the economy. On the upside, the Institute of Supply Management's new orders index showed a rise, indicating that manufacturing activity could pick up in the future.

Separately, employment research firm Challenger Gray & Christmas reported that job cuts at U.S. firms fell 41 percent to a 22-month low last month, perhaps indicating that heavy layoffs may be dwindling.

"The new orders index was better, profits are going to be up a little, interest rates are at a record low, there have been so many layoffs that that may start to dry up, there will be rising productivity and higher profit margins -- all these things combined could give some support," New Millennium's Carty said.

Holiday retail sales. Retailers including Wal-Mart Stores and Target have said September sales at stores open a year or more are weak. But what if October same-store sales pick up and holiday sales go through the roof?

Elections swing far right in November. Robert Torricelli's quitting the Senate race in New Jersey means the Democrats could lose control of the Senate, which might give stocks a boost, as big business tends to like a Republican government.

More perp walks. Although corporate governance fears have ebbed following the Enron, WorldCom and ImClone debacles of the past year, don't markets generally like seeing the bad guys punished?

But realistically, even with all of these factors in play, markets have virtually no chance of getting enough of a boost to close in the black.

"On average, coming out of a bad September, October rises 5 percent and the fourth quarter rises 4 percent overall," Sam Stovall, senior investment strategist at Standard & Poor's, told CNNfn's CNNmoney Morning.

"So if you use history as a guide, we're looking for a bounce," he added, although that bounce is certainly unlikely to be in the double digits.

However, there is always the possibility of something totally unexpected happening that could give markets a boost. It just won't happen this quarter, analysts said.

"We're so stretched out, so oversold at this point, that we have no idea what a potential snap back could be," GlobalValue's Kolluri said. "This is like a hot, dry forest and one good spark is all we need for it to really take off."