A few tidbits from TSG Weekly...

"With a total of 3243 companies having reported so far in the tenth week of Q4-08 earnings reporting season (up from 3028 last week), the net loss on continuing operations widened to ($205.6) billion (from ($200) billion last week) versus +$124.6 billion in Q4-07 which works out to a change of -266% from Q4-07. This compares to -262% last week, -197% two weeks ago and -46% in the opening week of reporting season. The final result for Q3-08 was -62% from Q3-07.

After four weeks in a row of losses across the board, stocks made gains and impressive ones at that with the major indexes (except the Dow) making double-digit gains. But there are signs that this brief albeit powerful bear market rally may be running out of gas.

Although weekly volumes are at or above average, volumes are falling as stocks rose for the major indexes and that is decidedly bearish. Rallies require steadily increasing volume to remain strong and falling volume demonstrates declining interest from buyers and is usually a precursor to lower prices.

Not surprisingly given the rally, the Market Volatility Index (VIX) fell this week to 42.36 from 49.33 last week. Although a falling VIX is generally bullish, that this occurred on falling volume makes it bearish.

Meanwhile, the 3-month London Interbank Offered Rate (LIBOR*) jumped again to 1.31563% from 1.2925% last week. This compares to LIBOR 52-week high of 4.81875% last October."

Regards - VHF

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