The Dow Jones industrial average recovered some of Thursday's decline, and a nearly 11% rocketlike gain by Nike (NKE) had a lot to do with it. However, solid gains by other consumer-oriented names in the 30-stock blue chip index (think Apple (AAPL), Home Depot (HD), American Express (AXP)) also helped the Dow act as the leading index Friday.
X The Dow Jones industrial average lost some of its decent gains in the last half hour of trading, closing up 0.3%. That nipped a gain of nearly 0.2% by the S&P 500. The Nasdaq composite surrendered modest gains to lose almost 0.1%.
Volume shrank sharply on both main exchanges as trading desks left early for next week's July 4th holiday.
The Dow 30 snapped a five-week win streak, but lost just 0.2% for the week. In addition, among IBD's 197 industry groups, dozens actually roared sharply higher for the week. They included the oil field services (up 6.3% for the week), auto retail (up 5.6%), discount and variety retail (+4.4%), apparel and shoe retail (+4.2%) and hospitals (+3.5%).
Notable winners for the week in the retailing and consumer goods side include Coach (COH) and Ollie's Bargain Outlet (OLLI).
At 6140, the Nasdaq has now dropped in three of the past four weeks. Yet it is still holding firm along its rising 10-week moving average, as seen on a weekly chart. The pullback since the Nasdaq's all-time high of 6341 three weeks ago has so far been limited to 4%.
The small-cap S&P 600 rose 0.3%. At 859, the important equities gauge is on track for a second straight modest weekly gain.
While Nike, reporting solid quarterly results late Thursday, is now arguably challenging a 59.10 buy point in a first-stage base, Apple has already advanced past its own bottoming base via a breakout on Jan. 6-9 at 118.12. Today, shares are rising enough to allow long-term holders to sit patiently and see if the iPhone and iPad giant will summon enough strength to rebound back above its 50-day moving average.
At 144.02, Apple is just a 4% advance away from reclaiming the 50-day line, and this is key. Leading stocks have a habit of leading their rising 50-day moving average.
Another indication that long-term shareholders can wait and see how Apple reports its next quarterly results, likely in late July: Notice how on June 9 and June 12, turnover soared to 64 million and 72 million shares, respectively. Yet, each of those stats pales in comparison with the 112 million shares that changed hands on Feb. 1 after Apple reported positive EPS growth for the fiscal first quarter ended in December last year.
When you have a big decline in the heaviest volume ever since the stock's initial breakout, that's truly a chief red flag to lock in some gains, reassess the status of the stock's industry or sector, and to study the action of the main indexes.
Apple is poised for a reasonable weekly decline, down 1%, after having already propelled more than 32% past the 118.12 correct buy point from a perfect cup with handle formed from Oct. 11 last year to Jan. 5. Notice on a daily chart how the handle featured a mild, downward slope, indicating a final shakeout of impatient investors, before the breakout took place.
Apple sports a solid 83 Relative Price Strength Rating from IBD Stock Checkup, up sharply from the beginning of the year.
On Tuesday, after sellers pounded U.S. stocks (the Nasdaq dropped 1.6% in higher volume vs. the prior session, notching a fifth distribution day), IBD's Market Pulse table inside The Big Picture column noted a change in the outlook to "Uptrend under pressure" from "Confirmed uptrend."
The former means that it's harder to make money on the long side. It does not necessarily mean, though, that it's easier to make money going short in equities.
Home Depot, meanwhile, is trying to regain its 50-day moving average after a sharp four-day slide that began on June 20. Shares are up 1% to 153.70, and are holding nicely above a Jan. 23 breakout past a 137.42 saucer-with-handle buy point.
In the April-ended first quarter, Home Depot's earnings grew 16% to $1.67 a share, extending a magnificent streak of double-digit bottom-line increases to 13 quarters.
The Street sees Q2 profit rising 12% to $2.21 a share; the current quarter ends in July.
In other financial markets, crude oil jumped 2.5% to $46.07 a share amid a rout in the U.S. dollar this week. So U.S. oil exploration and field services rallied more than 1% in the stock market today, but so did homebuilders, construction machinery, jewelry, wood products, heavy construction and discount and variety retailing firms.
Government bonds continued to drop hard, and the benchmark 10-year U.S. Treasury bond yield soared to 2.30%, the highest since mid-May.
RELATED:
Where Is The Market Headed? The Latest In The Big Picture
When Did Apple Flash These 2 Sell Signals?
Is The Tech Rally Finished, Or Just Ready For A Normal Pullback?
Which Stocks In The IBD 50 Bucked The Market Decline?
Medicals Have Been Leading IBD's New High List; How About Now?
