Do Stock Markets Fall when Interest Rates Rise?Here’s the thing...

Do Stock Markets Fall when Interest Rates Rise?

Here’s the thing about the U.S. stock market and interest rate hikes. If you try to find data showing a correlation between rising rates and falling markets, you might be disappointed.

Dow Jones Market Data recentlyanalyzed the five most recentrate hike cycles to see what history says about stock market returns in these periods. Their analysis—duplicated in the chart below—illustrates that during these five long-term periods, the three leading stock market indexesonly declined during one rate hike cycle.

	Rate Hike Cycle	DJIA	S&P 500	Nasdaq
Feb. 1994 to July 1995	16.30%	13.80%	18.10%
March 1997 to Sept. 1998	17.40%	32.60%	40.00%
June 1999 to Jan. 2001	-1.60%	-5.00%	-13.30%
June 2004 to Sept. 2007	28.70%	30.00%	26.90%
Dec. 2008 to July 2019	213.70%	243.10%	442.00%
Average % Change	54.90%	62.90%	102.70%
Median % Change	17.40%	30.00%	26.90%