Expecting a rest period into the week turned into exactly that for the market…Luckily, we‘d add!!  Why luckily??.    Just look at the underperformance of the Semi’s this week (>4% down )  and you ask how the heck did the market hold with a ‘leadership’ group failing so badly?    However this plays out, one thing is certain is it’s a Bull ‘worry’ to have a leader puke and it’s curtailing upside penetration.    As we pointed out August 1 before CSCO Aug 11th,(CSCO note below), INTC ..”..signs of technology softening demand is showing up globally (possible correction in technology coming),   he sector is down near 15% since with more pre-announcements blow ups on the way.    BBY’s  report will be in focus this week to see how big the consumer related softness (PC‘s TV‘s.)    On Friday, SMH (-1%) was down 2.5% mid day before reversing off lows helping market eke out a 1109 by close.

The market recouped it’s DB  losses after cooler heads prevailed and this weekend the Basel capital rules  are forthcoming and should not be as oppressive as feared.   It actually may turn out as an advantage for US-CDN banks in the form of consolidation and even payouts to the equity holders.  In the beginning of the week , financials will also update the street via conferences.  This is shaping up as a potentially big week ahead for the group.  Rotation ..new leader emerging?

CSCO’s  man speaks at an analyst day premarket Tuesday, FDX  earnings on Thursday(transports) .

Simply, rest period ends Sunday night with Basel, China macro consumer data leading off, probably with a single, followed by a hard hitting lineup.