Which stocks could move following a fed rate hike?

As evident from the S&P 500 and Nasdaq’s bumpy ride this year, traipsing along on the heels of Federal Reserve rate increase rumors, stocks react not only to actual changes, but the foreboding whispers that proceed them.

While it is clear that the broad market wobbles on these whispers, what is not predictable with 100 percent certainty is which stocks could move following the actual Fed rate hike. However, it is possible to speculate on which sectors (multinationals, oil, energy, etc.) could move, and which players (Boeing, Exxon, etc.) within these sectors will most likely be counted on to also move.

Bonds Likely To Outperform

While the movement of the market as a whole may scuttle all over the place immediately following a rate hike, bonds are likely to outperform over the long term.


  • – iShares Barclays 20+ Yr Trea.Bond (ETF) (NYSE: TLT)
  • – Vanguard Total Bond Market ETF (NYSE: BND)

Multinationals Likely To Tumble

As seen in the past, multinational companies might struggle immediately following a Fed rate increase. It could be wise to keep stocks that have fallen in the past on such changes securely in your sights.


  • -The Coca-Cola Co (NYSE: KO)
  • -Wal-Mart Stores, Inc. (NYSE: WMT)
  • -Boeing Co (NYSE: BA)

Oil And Energy Stocks Likely To Be Jostled Around

Oil has historically tumbled on Fed rate changes. Energy typically follows the path of oil.
Particularly, it could be prudent to keep an eye on multinational stocks within these sectors.


  • -Exxon Mobil Corporation (NYSE: XOM)
  • -Dow Chemical (NYSE: DOW)
  • -ConocoPhillips (NYSE: COP)
  • -Royal Dutch Shell plc (ADR) (NYSE: RDS-A)

Broad Indications

However speculative stock predictions might be, one thing is certain: History has indicated that the stock market suffers when the Fed raises rates. Within the last century, the Fed has increased rates 16 separate times; following 13 of these 16 hikes, the S&P 500 has slipped by a significant +/-5%.

Luckily, history also shows that Fed rate movements are cyclical, and the volatility that will inevitably follow a hike will simmer down partway through the rate cycle.

The above report is produced to provide a starting point for your own financial research and should not be interpreted as advice or invitations to buy or sell any securities. None of the information contained therein constitutes a recommendation. Invest at your own risk. Investing in any mentioned securities carries innate risks and may be speculative. Information on past performances is not necessarily an accurate representation of future performance.

Lightspeed Financial Services Group LLC is not affiliated with these third-party market commentators/educators or service providers. Data, information, and material (“content”) are provided for informational and educational purposes only. This content neither is, nor should be construed as an offer, solicitation, or recommendation to buy or sell any securities or contracts. Any investment decisions made by the user through the use of such content is solely based on the users independent analysis taking into consideration your financial circumstances, investment objectives, and risk tolerance. Lightspeed Financial Services Group LLC does not endorse, offer nor recommend any of the services or commentary provided by any of the market commentators/educators or service providers and any information used to execute any trading strategies are solely based on the independent analysis of the user.

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