Stocks closed modestly lower yesterday, but well of their session lows.

Last week's better than expected earnings and jobs report, which sent stocks soaring last week, gave way to a little bit of profit taking yesterday. But that might be short-lived.

After the close yesterday, NXP Semiconductors posted a positive EPS surprise of 1.92%, and a positive sales surprise of 0.78%. They were trading higher by 1.30% in after-hours trade. And Palantir, after the close, posted earnings in line with expectations, and a positive sales surprise of 0.81%. They soared by more than 19% in after-hours trade.

Today we'll hear from 190 companies with headliners like Eli Lilly, BP, and Fiserv reporting before the open, and Toyota, Amgen, and Chipotle after the close.

In other news, the PMI Composite report showed the Index coming in at 52.0 vs. last month's 51.4. The Services Index was at 52.5 vs. last month's 50.9.

The ISM Services Index rose to 53.4 vs. last month's 50.5 and views for 52.1.

Not much on the way of economic reports out today. But we will hear from several Fed policymakers as they give speeches and interviews today.

Fed Chair Jerome Powell, in interviews over the weekend, stressed that the Fed was in no hurry to cut rates, and that they could afford to be patient given the resilience of the economy and jobs market.

In their latest FOMC announcement, they still forecasted three 25 basis point rate cuts. But Mr. Powell suggested it was not going to happen in March. And after last Friday's jobs report, some are suggesting it might not even happen in May, but rather June.

Either way, rate cuts are still on the table, even though the timeline is getting pushed back. But the idea that they indeed are still coming, remains bullish for the market.

In the meantime, the market can get back to focusing on earnings. And since stocks typically go up during earnings season, that's good news for stocks.

Come early March, the market will have to grapple with the looming budget standoff in Congress, as the recent continuing resolution (CR) only funded the government until March 1, and March 8. Will they do another CR, pass the bills necessary to fund the government for the entire fiscal year, or come to an impasse and shut down the government? To be determined. But that's 4 'long' weeks away.

For now, stocks seem focused on lower inflation, eventual rate cuts, and better than expected earnings.

And that should keep powering the market higher.

See you tomorrow,