Who Holds Up Best When a Rate-Hike Cycle Begins? Barclays: Historically Only Energy Stocks Rose Against the Trend

Market expectations are rising for a Federal Reserve rate hike in early 2027. Barclays research shows that after a rate hike begins, the median S&P 500 decline is 3.9%, with small-cap and financial stocks leading the losses, as style shifts toward large-cap and value. Energy stocks, supported by commodities and physical demand, are historically the only sector to post positive returns in the quarter following the first rate hike.