Policymakers may decide to raise interest rates for the first time since the Great Recession, marking the end of an era of ultra-low rates that has defined financial markets for almost seven years. In turn, that has boosted demand for other dividend-rich securities, such as high-yield bonds and real estate investment trusts. [...] if interest rates start rising, will that automatically reverse the stock market's momentum? Jim McDonald, chief investment strategist at asset manager Northern Trust, explains what he expects to happen with interest rates, how that will impact financial markets, and what investors should, or shouldn't do. [...] they would get up to 50 basis points (0.5 percent) and then they have to hang out. Because along with the Bank of England they will be the only central bank that is raising rates. Some people are concerned about it, but this an extremely studied event and the market is rarely disrupted by an event that is over analyzed. The history of the stock market is that it does fine when the Fed starts to raise rates, because the Fed taking action is corroboration that the economy is strong. Financial stocks have been hurt by the low interest rate environment and they should be good performers with a higher rate environment. [...] we're not overweight financial stocks right now because we think that the rate increases are going to be relatively minor. There's been a significant increase in volumes across the industry tied to the Affordable Care Act.