Stocks ended the week higher as investors digested a slew of economic data. On Friday, stocks seesawed higher after the government released a stronger than expected jobs report. Volume, an important indicator of institutional sponsorship, was higher than Thursday's levels on both major exchanges. The fact that the major averages closed in the lower half of their daily ranges on heavier volume, however, could be interpreted as churning - which is not a healthy sign. Advancers led decliners by more than a 2-to-1 ratio on the NYSE and by nearly a 3-to-1 ratio on the Nasdaq exchange. There were 45 high-ranked companies from the CANSLIM.net Leaders List that made a new 52-week high and appeared on the CANSLIM.net BreakOuts Page, one more than the total of 44 issues that appeared on the prior session. Leadership among high-ranked growth stocks had dried up in recent weeks, so the expansion in new highs this week has been a welcome improvement. New 52-week highs solidly outnumbered new 52-week lows on the NYSE and on the Nasdaq exchange.

On Monday, stocks spent most of the session in the red but buyers showed up in the final hour which helped the major averages close higher on the day. Monday was the first full trading session since the Dubai news spread during Thanksgiving. It was encouraging to see the major averages rally as investors largely dismissed the Dubai news. Elsewhere, the Chinese government reiterated its stance regarding its stimulus package after India announced its economy grew at a very healthy rate of +7.9%, which topped estimates. In the US, the National Retail Federation released a report that showed that holiday traffic was up from the same period last year, but the average shopper spent $343.31 in stores and online over the Thanksgiving holiday weekend, less than the $372.57 spent last year.  The group reaffirmed its forecast for a -1% decline in spending for the holiday season.

On Tuesday, stocks rallied around the globe after Dubai World said it took "constructive" steps to restructure nearly half its debt. HSBC released a report showing that Chinese manufacturing, rose in November. This echoed the Institute for Supply Management (ISM)'s manufacturing index. The ISM said US manufacturing rose in November for a fourth consecutive month which is a healthy data point for the global recovery. Turning to the housing market, the National Association of Realtors said the number of contracts to buy previously owned homes in the US unexpectedly rose +3.7% in October.

Stocks ended mixed on Wednesday after ADP Employer Services, the country's largest private payrolls company, said US employers slashed -169,000 jobs last month. This topped the Street's forecast for a reading of -150,000 and led many to question the government's official reading which was released on Friday. Before Thursday's open, the Labor Department said that 457,000 jobless claims were reported last week which was just under the Street's estimates. Stocks were up for most of the day but a late burst of selling sent stocks lower in the final hour which was not a healthy sign. Finally, before Friday's opening bell, the Labor Department released a much stronger than expected jobs report. The report showed that US employers "only" shed -11,000 jobs last month (not a typo) while the unemployment rate fell to -10%. This smashed the Street's estimates for a reading of over -100,000 and analysts believed that the unemployment rate would hold steady at +10.2%.

Initially, the market rallied on the jobs report but sellers quickly emerged which put pressure on the market. It was disconcerting to see a several high profile leaders such as Apple Inc. (AAPL -1.61%) and Netflix (NFLX -3.04%) get smacked on Friday. Apple, one the strongest stocks since the March lows, triggered a technical sell signal when it violated its well defined 8-month upward trendline and its 50 DMA line on Friday. This was the first time since the March low that Apple closed below support (its upward trendline and 50 DMA line). Volume surged as the stocks fell which indicated that large institutional investors were unloading their positions, not Aunt Mary or Uncle Bob. The dollar rallied sharply after the jobs report was released which put pressure on a slew of commodities, mainly gold. Gold plunged sharply today which dragged a slew of gold related stocks. Remember that gold has been one of the strongest performing groups in recent weeks and now that it has fallen, a new group will need to emerge to carry this market higher. That coupled with the recent questionable action in the major averages and the dearth of leadership suggests this rally is "under pressure" which means caution is advised.  

PICTURED: The Dow Jones Industrial Average closed with a modest gain as volume rose which equals churning.

Strength in the US dollar contributed to the standout decline for the Gold & Silver Index ($XAU -5.48%), but after a great streak of gains such a pullback was eventually bound to happen.  Weakness in the Retail Index ($RLX -1.19%) and energy shares created a drag on the major averages as the Oil Services Index ($OSX -0.70%) and Integrated Oil Index ($XOI -0.54%) also ended Friday's session in the red.  however, financial shares made a very important positive contribution as the week came to a close, with the Bank Index ($BKX +2.19%) and Broker/Dealer Index ($XBD +2.27%) posting solid gains.  Healthy gains from the  Healthcare Index ($HMO +0.95%) and a positive bias throughout the technology sector also underpinned the rally while the Networking Index ($NWX +2.01%) and Semiconductor Index ($SOX +2.06%) outpaced the Biotechnology Index ($BTK +0.25%) and the Internet Index ($IIX +0.93%).

Charts courtesy www.stockcharts.com

PICTURED: The Retail Index ($RLX -1.19%) is pulling back from 2009 highs, but still in very healthy shape.  It found great support near its 50-day moving average line throughout the recent rally.

Longtop Financl Tech Ads (LFT +$0.18 or +0.48% to $37.46) has been wedging higher, encountering no distributional pressure. It is extended more than +5% above its pivot point and above its "max buy" price, so disciplined investors would avoid chasing it. Recent highs in the $31 area are an initial support level to watch.

A proposed offering of additional shares on 11/16/09 seems well received by the market. Its fundamentals remain strong.  The number of top-rated funds owning an interest in its shares rose from 20 funds in Dec '08 to 50 funds in Sept '09, which is reassuring concerning the L criteria.  It has reported strong annual and quarterly earnings increases (good concerning the C & A criteria) backed by strong sales revenues increases. Return on Equity of +20% is above the +17% guideline. Upward progress can often be hindered by additional share offerings for the near-term, yet institutional investors typically increase their interest through the process.   LFT was first featured at $22.19 on Thursday, April 02, 2009 in the CANSLIM.net Mid Day Breakouts Report (read here).

Color Codes Explained :
Y - Better candidates highlighted by our staff of experts.
G - Previously featured in past reports as yellow but may no longer be buyable under the guidelines.