In the nine instances since 1955 that the Fed has started raising rates after a recession, the Standard & Poor's 500 index has risen by an average of 58 percent between the first hike and the peak of the market, according to LPL Financial, an independent broker-dealer based in Boston. "Rising interest rates are usually a symptom of the success of the economy, and companies are benefiting from it," says Seth Masters, chief investment officer for Bernstein Global Wealth Management. Stocks rise when the Fed lifts rates enough to contain inflation, but not by so much that the hikes suffocate borrowing and lending. A healthier economy also means stronger corporate earnings, which drive stock prices, says Jim McDonald, chief investment strategist at Northern Trust Asset Management. Once the central bank ends its third round of quantitative easing after its next meeting that starts Oct.
Why Rate Hikes Are Good News For Stocks
By STEVE ROTHWELL, AP Markets Writer, Seattle Post-Intelligencer: Business
Fri, 09/26/2014 - 10:25am
Sections: business
BING NEWS:
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Today, the labor market showed signs of weakness and Federal Reserve officials spoke for the first time since their meeting this week.
05/3/2024 - 5:58 am | View Link - Good start for petrol price projections in June
Positive movements in global oil prices and a solid start to the month for the rand points to little change building for June’s petrol price.
05/3/2024 - 1:59 am | View Link - The Fed's Latest Decision on Interest Rates Is Great News for Savers. Here's Why
And the Federal Reserve has been trying its best to cool that rampant inflation.In 2022 and 2023, the central bank implemented a series of interest rate hikes that drove the cost of borrowing up. The ...
05/1/2024 - 8:00 pm | View Link - Fed Holds Policy Steady: Rate Hikes Remain 'Unlikely' Despite Lack Of Inflation Progress
The Federal Reserve left its policy rate unchanged and argued its policy stance is 'in a good place', but officials are concerned about the recent lack of progress on inflation.
05/1/2024 - 8:00 pm | View Link - US Economy News Today: Powell Dismisses the Need for Additional Rate Hikes
Today, the Federal Reserve concluded its two-day Open Markets Committee meeting by leaving interest rates untouched, as expected, and saying it will likely stay that way for longer than previously ...
05/1/2024 - 9:18 am | View Link - More
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