NEW YORK ( TheStreet) -- U.S. stocks have started the week with a nice vote of confidence but the terrain gets tougher from here. Eighty S&P 500 companies are due to report before the closing bell sounds on Friday. The early reviews on the third quarter are worse than expected but it's easy enough to brush that off to small sample size. Over the next few days, the picture will clear up and nervous investors holding healthy profits for 2012 overall may decide to cut back on their equity exposure. What's worth considering is that there's some evidence corporations have already started bailing out. Over the weekend, research firm TrimTabs noted that corporate selling, measured by new offerings and net insider selling, has totaled $12.4 billion so far in October vs. corporate buying (new cash takeovers plus announced buybacks) of $8.5 billion. That's not a huge gap (and it doesn't factor in the Sprint ( S)/ Softbank deal) but there's more of a disparity going back to the start of September, when the tally is corporate selling of $62.7 billion vs. corporate buying of $34.5 billion, a $28.2 billion difference. "Given the lofty valuations at which the overall U.S. stock market trades, we can hardly blame corporate America for ramping up its selling," the firm wrote. The trend is especially concerning if the impact of buybacks on helping the major indices return to multi-year highs is factored in. Sean Darby, chief global equity strategist at Jefferies, cited S&P data Monday saying S&P 500 constituents conducted $111.7 billion in buybacks in the second quarter, up from $84.3 billion in the first quarter. "
T he unintended consequences of the reluctance of companies to invest in new capex but hoard cash at close to 1945 record levels is to buyback shares," he said. "Aside from low real interest rates, one of the main reasons why the US equity market has held up well is due to the squeeze on the stock free-float. Indeed, stock repurchases have offset stock withdrawals by households during the past six months."