Interest-Rate Sensitive Stocks

Forbes is reporting that although utilities and REITs are viewed as interest-rate sensitive, the stocks have actually been doing alright. Inflation is high in the US, and bond markets have noticed this, but stocks have not yet. The article warns that usually, the stock market follows the bond market.

Rick Stuchberry on Interest Rate

When will we get back into the interest-rate sensitive stocks? We’re in a bear market for interest rates for long time. Not just a year or two. Inside those cycles are smaller cycles–maybe you can step into them. Utilities are full of debt, and interest rates will rise for the next decade or two, even. These stocks will face headwinds for a long time.

It’s been a bear market for these stocks. The recommendation is to get into smaller cycles if you decide to take upon these kind of stocks.