Snap quiz: What’s the national pastime of America? If you answered baseball or football, you’re wrong. It’s shopping.

In the U.S., consumer spending accounts for about two-thirds of U.S. gross domestic product (GDP), providing the growth engine that has pulled the country’s economy out of most downturns for the past seven decades.

How has the coronavirus pandemic affected consumer spending? You might be surprised to learn that after a sharp decline, spending has returned to its previous levels. That’s great news for stocks.

The benchmark SPDR S&P 500 ETF (SPY) ended 2020 at a new all-time high on a closing basis. Wall Street is forward looking, so markets have continued to rally as investors focus on imminent fiscal stimulus, accelerating vaccination rates, and resurgent retail spending.

On Thursday, the Dow Jones Industrial Average fell 7.10 points (-0.02%), the S&P 500 rose 6.50 points (+0.17%), and the tech-heavy NASDAQ climbed 53.24 points (+0.38%). The S&P 500 and the NASDAQ hit new record highs. In pre-market futures trading Friday, stocks were edging lower.

Wither the stock market in 2021? As always, much depends on consumers. Without confident consumers who have money in their pockets, there won’t be a recovery. On that score, the trends are bullish.

President Biden’s $1.9 trillion coronavirus relief bill would give the economy and stock markets a shot of adrenaline, triggering a nationwide hiring spree. Higher employment and individual stimulus checks would in turn prompt a burst of consumer spending.

Read This Story: Just Ahead: An Epic Jobs Boom

Retail sales are projected to grow by 8.1% this year, the fastest pace this century, to a record $4.3 trillion, according to a report published Thursday by retail consulting firm Customer Growth Partners. This strong rate of growth exceeds the annual 6.4% increase in 2004, which had been the biggest increase of the century so far.

Recent retail sales data already in the books show how the table has been set for an unprecedented level of shopping this year.

Research firm FactSet looked at three data sets to gain insights into U.S. consumer spending during the pandemic: Retail Sales, Personal Consumption Expenditures, and S&P 1500 Consumer Discretionary sector revenue growth.

According to this aggregated data drawn from the U.S. Census Bureau, consumers had resumed their previous levels of spending by the end of 2020 (see chart).

In fact, total retail sales excluding food services were up 6.3% in December compared to December 2019. By examining the fourth quarter, which includes the full holiday season as well as the autumn surge in coronavirus cases nationwide, we can determine which industries are the worst affected and which ones are thriving.

Compared to the fourth quarter of 2019, restaurants, gas stations, apparel, and electronics and appliance stores all suffered double-digit declines in Q4 2020. However, retailers selling entertainment goods and construction materials, as well as e-commerce, enjoyed double-digit growth.

Consumers to the rescue…

For anecdotal confirmation about changing retail habits during the pandemic, just look to your own daily life. You’ve probably forsaken restaurants and bars in favor of eating and drinking at home. It’s likely that your family is avoiding physical movie theaters, theme parks and sports stadiums and seeking diversion instead from cloud-based gaming and streaming video.

Quarantined homeowners are tackling long-deferred, do-it-yourself improvement projects. Gym memberships are getting canceled and replaced with in-home exercise equipment. Business attire is giving way to track suits and yoga pants ordered online.

Retail spending dramatically fell during the early months of the pandemic, but there was a surge in the late spring and summer due to pent-up demand. The first round of stimulus checks in March 2020, combined with high household savings rates, helped fuel that surge. Under the Biden administration, new stimulus checks will soon be wending their way to checking accounts.

Of course, the pandemic has divided the economy into winners and losers. Modes of retail spending that already were on the wane (e.g., physical stores in shopping malls) will experience a hastened demise. E-commerce and at-home activities will continue to prosper.

But like the cavalry in the final reel of a Western, the American consumer has come to the rescue. In anticipation of a robust consumer-led recovery, our investment team has put together a new special report: “5 Red Hot Stocks to Own in 2021.”

We spent the last several months digging through thousands of pages of financial documents, listening to corporate earnings calls, monitoring how companies are managing the coronavirus crisis, and out of the thousands of stocks reviewed, we’ve pinpointed five that are poised to deliver outsized gains this year and beyond. For your copy of our special report, click here.

John Persinos is the editorial director of Investing Daily. To subscribe to John’s video channel, follow this link.

Editor’s Note: If you have any profitable “success stories” from following our team’s investment advice, let’s hear about them! With your permission, I’d like to share your real-life tales with readers. Send your correspondence to: mailbag@investingdaily.com.