Markets Are Pricing in a Fed Rate Hike in December. Here's What Investors Should Do, According to History.

Markets are pricing in an 81.2% probability of a Fed rate hike in December 2026. Historical data shows the S&P 500 typically rises ~9% in the year following a new rate-hike cycle, despite initial short-term declines. Investors should avoid panic selling, favor energy stocks, shift to short-duration bonds, and monitor the Fed's dot plot for clues about future rate hike aggressiveness.