Almost every day in the investment world, you will hear the terms "bull market" and "bear market".

They are used to describe the prevailing sentiment of the stock markets and its anticipated future direction.

A bull market is described as a period of prolonged rises in share prices, generally accompanied by feelings of investor optimism and economic wellbeing.

Typically, the economy is buoyant, company profits are strong and employment levels are high. Trading volumes also tend to be healthy because investors are willing buyers when share prices are rising. Investors who think prices will continue to rise are termed "bullish".

In contrast, a bear market is one that is in decline. Share prices are continuously dropping, resulting in a downward trend, which investors believe will continue in the long run, and which, in turn, perpetuates the spiral.

During a bear market, the economy typically slows, profit warnings become more common and unemployment rises as companies begin to lay off workers. Investors who think prices will fall are termed "bearish".

But why are rising stock markets called bull markets and falling ones bear markets? Why are they not called "bird markets" when they soar and "whale markets" when they sink?

The origin of these two stock market terms is surprisingly nebulous, considering how widely they are used. There are, however, a few interesting theories.

One proposes that bear and bull markets are named after the way in which each animal attacks its victims. Bulls thrust upwards with their horns, whereas bears generally stand on their hind legs and swipe downwards upon their prey.

Another theory proposes that animal personalities are behind the symbolism, in that bearish investors and bear markets move with caution, while bulls are bold and likely to charge ahead.

But the most widely accepted notion of their genesis pertains to the selling of bear skins. In the early 18th Century, England was gripped by financial crisis and the economic outlook looked bleak.

In anticipation of falling prices, clever jobbers - bear skin brokers in London - tried to profit by selling their skins without owning.

This risky practice of short selling tends to be a self-fulfilling prophecy, putting downward pressure on prices. Thus, the connection was drawn between a falling market and the bear.

Unfortunately, this notion does not explain how the bull became the bear's counterpart.

So are we in a bull or bear market, and what does the future hold?

Generally, the stock market needs to rise or fall by at least 20 per cent before it is said to be in the throws of a bull or bear market.

The UK stock market is currently enjoying one of its longest bull market phases on record, with the FTSE All Share Index almost doubling in value since its low point in March 2003.

But in recent weeks, the market has endured a sharp sell-off of almost ten per cent, and the question now is whether this is merely a temporary correction or the start of a new, more sinister bear market.

I believe we will see somewhat of a "kangaroo market", as volatile share prices continue to hop all over the place for the next few weeks, as the stock market tries to reprice credit risk.

However, companies continue to report strong results, and most valuations remain attractive.

I, therefore, remain bullish, believing the market will be at a higher level at Christmas.

* Mark McMullan is an investment manager in the Teesside office of Wise Speke, and can be contacted on 01642-608855.