(Repeating column initially transmitted late on Friday)

By Leah Schnurr

NEW YORK, May 31 (Reuters) - Wall Street faces a historic shake-up next week as General Motors, a pillar of American industry, heads into bankruptcy, but the market could advance further if economic data signals the worst of the recession has passed.

Stocks could also get a boost if commodity investors see more signs of a recovery in demand as it would boost profits and share prices of resource companies, and particularly the oil industry.

Though the markets closed out May with a third straight month of gains, the longest monthly winning streak since the fall of 2007, the broad S&P 500 appears stuck in a range around the 900 level.

Action in the foreign exchange market and turmoil in U.S. government bonds could undermine the S&P 500, however, as it tries to keep a grip on the nearly 36 percent gain accumulated since diving to 12-year lows in March.

"If you have a return to some level of growth, with some moderate inflation, that would be the most positive scenario for equities and you could see more of a rally," said Sasha Kostadinov, portfolio manager and research analyst at Shaker Investments in Cleveland, Ohio.

Analysts said a GM bankruptcy was unlikely to have much of an impact on the market in itself -- the once mighty automaker's shares have plunged below $1, making its weight less influential.

Nonetheless, the bankruptcy will likely have ripple effects on the broader economy, particularly through job losses.