Last week saw a number of important economic data releases, with a focus on February’s inflation reports and a first look at consumer confidence in March. Consumer confidence increased by more than expected to start the month, bringing the University of Michigan consumer sentiment index to a one-year high. This week will be packed with updates once again. Highlights will include February’s retail sales and industrial production news and reports on home builder confidence and new home construction.

As a reminder, this written update will be followed next week by a video update, and then back to a written post on a weekly basis. Thanks as always for reading and watching.

My colleague Sam Millette, senior investment research analyst on Commonwealth’s Investment Management and Research team, has helped me put together this month’s Market Risk Update. Thanks for the assist, Sam!!

Equity markets rebounded in February despite some late-month volatility driven by a spike in U.S. interest rates. The S&P 500 gained 2.76 percent, while the Dow Jones Industrial Average rose by 3.43 percent. Riskier assets were hit hardest by the volatility at month-end, and the technology-weighted Nasdaq Composite gained 1.01 percent. Despite the overall positive results, the month-end volatility served as a reminder of the potential risks markets still face.

My colleague Sam Millette, senior investment research analyst on Commonwealth’s Investment Management and Research team, has helped me put together this month’s Economic Risk Factor Update. Thanks for the assist, Sam!

The economic recovery picked up speed in February, driven by public health improvements and the federal stimulus checks that reached bank accounts. We saw a positive turnaround in consumer confidence and spending figures, along with an acceleration in hiring. We also saw signs of continuing normalization of long-term interest rates, which is a positive signal that the economic recovery remains on track.

Last week saw a number of important economic data releases, with the better-than-expected February employment report serving as a highlight. This will be another busy week for updates, with a focus on consumer and producer inflation, as well as a first look at consumer sentiment in March.

Today’s post is brought to you by Anu Gaggar, international analyst, and Giovanna Zaffina, manager, wealth management platform.

This morning, we got some very good news about the recovery. The headline number of the jobs report, with 379,000 jobs created, was excellent—and almost double the expected 200,000. This is good news. When you look into the details, the news is even better. Clearly, the reopenings around the country have made a big difference in the job market. Looking forward, that trend will give us a real tailwind as vaccinations accelerate.

Today, I'd like to provide an update on the coronavirus, including the economic and market implications. On the medical front, the stats have been getting better for the past two months, with case growth and hospitalizations down. That’s the good news. The bad news is that we are now at levels we saw at the peak of the second wave. And with some states starting to reopen and ending mandatory mask wearing, there are real things to worry about in the months ahead.

February looks to have been the start of our recovery from the pandemic. The medical news improved markedly, and the vaccination deployment finally got traction. Consumer confidence and spending turned around, and business investment continued to improve. Markets moved up. It was a good month all around. While some areas of concern became apparent at month-end, the progress was real—and significant.

Markets climbed in February, although they faced some turbulence on a spike in interest rates. While markets were choppy, the medical news improved. New cases and hospitalizations dropped, and vaccinations more than doubled. On the economic front, unemployment remains high, but companies are hiring again. Plus, stimulus payments hit bank accounts, and consumer confidence is moving up.