Stocks closed higher on Friday. And the Dow and the S&P closed higher for the week, while making new all-time highs in the process.

Strong earnings continue to underpin the market.

But the catalyst for Friday's gains appeared to be the Employment Situation Report.

Interestingly, the job gains came in sharply under expectations with 'only' 266,000 new jobs vs. the consensus for 998,000. (That came out to be 218K in the private sector and 48K in the public.) The unemployment rate ticked up to 6.1% vs. last month's 6.0% and views for a lower reading of 5.8%.

So why did the market go up? A few thoughts: for one, 266K new jobs is a solid number. It was only disappointing because everybody was expecting nearly 1M. Some believe the numbers were being held down because the unemployment benefits for some, paid more than actually going back to work. That's a short-term phenomenon. But a real concern nonetheless. Others have suggested that the report was skewed due to the seasonal adjustments since the unadjusted numbers show more than 1 million new jobs gained. And lastly, some believe the less than expected gains helps the idea that more stimulus is still needed and not less.

All interesting reasons. And while the numbers were underwhelming, there's a strong belief that this report will be revised higher in the months to come, and that job gains are only going to accelerate.

Given all of the above, it's easy to see why the market was up on the news.

Looking at the week ahead, earnings season continues with another 1,137 companies reporting this week.

We should also start hearing more debate on the size of the infrastructure package and the Families Plan package, along with the tax hikes to pay for it all.

In the meantime, the economy continues its recovery.

And that's why full-year GDP is expected to come in at the fastest pace in 36 years.

And why it looks like stocks have a lot more upside to go.

See you tomorrow,