Are we out of the woods as far as relying on our politicians are concerned? Surprisingly, the powers that be did come in right under the wire with a plan. Does it give any sort of solution to a problem that our kids and their kids will be dealing with? No, it doesn’t, but it’s a start. We have the issue of the debt ceiling looming and that will weigh on the market come Mid-February. However, for now, we have data and earnings coming up.

The markets have closed at their highest levels in five years and poised to go higher still. We said last year we felt we would have record highs before the end of 2012. We may be off by a couple of weeks but it was still a good call.

The data this week will continue to give some solid support for the market. The Small Business Optimism Index that is being released Tuesday morning should show an increase. Last month’s reading was down significantly and we think we will see a nice rebound. It’s a lagging indicator so it most likely won’t have any market moving impact. It still is important because many economists believe any major growth in the US Economy will stem from small business growth.

Jobless claims on Thursday will show improvement and we expect it to be at the 350 K level. Below that is a very good sign since we have had only two weeks below it in the last 3 years. Both of those times have been in the last three months.

Earnings season kicks off Tuesday with Alcoa (AA) reporting after the close and as we have said before, while this company used to be an integral part of the US economy, those days are gone. We expect that this earnings season will be better than expected.