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) -- Stocks finally

found a reason to rally on Thursday

, seizing on a jump in exports and a narrower than expected deficit to muster up the buying power to break a six-day losing streak.

It was the

Dow Jones Industrial Average's

first gain this month, and the blue-chip index now has a decent chance at breaking its streak of five consecutive negative weeks. A rally of 28 points or more will do the trick.

Main Street may not provide much help, however. The

latest sentiment survey from American Association of Individual Investors

showed investors grew much more nervous about Wall Street in the past week with expectations taking a sharp swing toward bearishness.

The organization has a base of 150,000 members, and it polls them each week for their view of the stock market's direction over the next six months, For the week ended June 8, 47.7% of respondents said they were bearish, up 14.2 percentage points from last week and well beyond the long-term average of 30%. The bull camp decreased to 24.4%, a loss of 5.8 percentage points, while those identifying as neutral fell to 27.9%, down 8.5 percentage points from a week ago. The long-term averages are 39% bullish and 31% neutral.

On the positive side of the ledger,


issued its weekly flow report late Wednesday, making the pronouncement that it doesn't believe this recent run of weakness marks the end of the bull market.

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"The Dow Jones

Industrial Average has posted a losing streak of six or more sessions 126 times since 1928," the research firm said. "Returns in the following two weeks tend to prove above average, although the difference is not statistically significant."

Mom and Pop have apparently been bailing of late though as


estimates retail investors have pulled $18.8 billion out of U.S. equity mutual funds and ETFs since the start of May, an amount it said was the heaviest outflow since August 2010. The firm viewed this as a good sign for the extended health of the bull market, as retail investors typically sell at the wrong time, and also took heart in a similar move in the flows from exchange-traded funds.

"We also take comfort in the behavior of ETF investors, who are traditionally poor market timers,"


said. "In the past week alone this group withdrew $5.6 billion from domestic stock funds and loaded up on leveraged short funds."

Volume may also be a factor in the severity of the recent decline, exaggerating the market's true bearishness, as the firm noted that NYSE trading volume fell to 783 million shares daily since the start of May, which is roughly half the volume in the same period last year.

Friday's economic data is scant with import and export prices due at 8:30 a.m. ET. More interesting may be the Treasury budget numbers for May at 2:00 p.m. ET. They at least have the potential to spark another round of debt ceiling rhetoric.

The earnings calendar is light as well but one momentum name stands out.

Lululemon Athletica

(LULU) - Get Lululemon Athletica Inc Report

reports its fiscal first-quarter results before Friday's opening bell, and with the shares more than doubling over the past year, the Canadian branded sports apparel retailer said Thursday its shareholders have approved plans for a two-for-one stock split.

The average estimate of analysts polled by

Thomson Reuters

is for a profit of 38 cents a share on revenue of $181.2 million, and the company has beaten Wall Street's consensus earnings estimate in eight straight quarter by an average of roughly 27%, so considering the stock's appreciation and the track record, the bar is already set pretty high.

Sterne Agee previewed the report on Thursday, saying it sees an in-line performance because of inventory constraints. The firm, which has a buy rating and $107 price target on the stock, is a penny below consensus, forecasting earnings of 37 cents a share for the April period.

"While buys were accelerated somewhat into April and Q2, inventories were expected to remain constrained through the 1H," Sterne Agee said. "Our checks suggest that business has remained quite strong and in many cases strengthened in April/May (particularly in the U.S., though Canadian stores may have been somewhat hampered by weather), with somewhat of an improved in-stock position but some items continuing to sell out at a very fast pace."

Still, the bears are out on Lululemon with 16 of the 23 analysts covering the stock at either hold (10), underperform (4) or sell (2), so an in-line report may get a rude reception.

And finally, shares of

Skechers U.S.A.

(SKX) - Get Skechers U.S.A., Inc. Class A Report

took a hit Thursday on nearly double their average volume as the company held analyst meeting. The stock should be active on Friday as well when the reviews start trickling in. Standard & Poor's has already offered up a quick comment, seeing some positives, like progress on the company's efforts to lower operating expenses, but maintaining a sell rating.


We now see greater potential for the company to fill retail shelf space with updated lifestyle and new, lightweight athletic footwear offerings for men, women, and kids that we think are innovative and on-trend in design," the firm said, adding later: "But we still expect Q2 and Q3 results to be hurt by aggressive clearance of toning category inventory."

S&P dropped its earnings estimate for this year by 20% to 80 cents a share, and slashed its 12-month price target to $12 from $15. Skechers' shares have dropped 30% since the start of the year, and the stock scraped a new 52-week low of $13.29 on Thursday. By the looks of things, relief may still be a ways off.


Written by Michael Baron in New York.

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Michael Baron


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