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.

Last week saw the release of a number of important economic updates, with most pointing toward faster growth to start the new year. Highlights included better-than-expected consumer confidence reports, a strong durable goods orders report, and a return to personal spending growth in January. This will be another busy week for updates, with a focus on business confidence and the February employment report.

We have had some turbulence in the market over the past couple of days. The bond market briefly seized up, with interest rates up by surprising amounts. This, in turn, shook the stock market, taking it down from the highs by about 4 percent for the S&P 500 and almost 8 percent for the Nasdaq. On top of all that, we have had events such as the ongoing GameStop show and the explosion of SPAC offerings. With everything that is going on, the recent pullback, and the signs of frenzy, is it time to worry? My take: not yet.

*I will be alternating the text and video versions of this update on a weekly basis. This week is text, next week will be video, and so forth. As always, thanks for reading and watching.