RESEARCH
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Stocks One Year After the Fed Started Hiking
The S&P 500 was higher one year after six of seven completed Fed tightening cycles since 1983. The median gain was 4.4%.
Jacob Radke
2 min read
S&P 500 price-index paths for one year after the first rate increase of each completed Fed tightening cycle since 1983; partial 2026 path through September 24.
Source · St. Louis Fed, Financial Modeling Prep, Associated Press, Tallac Options; Fjell Capital analysis
Positive after one year
6 of 7
Completed Fed tightening cycles since 1983 in which the S&P 500 finished higher one year after the first hike.
Median 12-month return
+4.4%
Median S&P 500 price return one year after the first hike across the seven completed tightening cycles.
2026 path so far
+1.6%
S&P 500 price return from the September 16 decision close through September 24; excluded from the historical median.
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Markets & Investing
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Key takeaways
Stocks were higher one year after six of the seven completed Fed tightening cycles since 1983.
The median twelve-month S&P 500 price return after the first hike was 4.4%.
The 2022–23 cycle was the only negative observation, at −9.1%.
The partial 2026 path was up 1.6% through September 24 and is excluded from the historical median.
The Federal Reserve raised interest rates last week for the first time since 2023.
The natural assumption is that higher rates are bad for stocks, given how 2022 went.
The chart above follows the S&P 500 for one year after the first hike of every completed Fed tightening cycle since 1983.
In six of the seven cycles, stocks were higher one year later. The median gain was 4.4%. The new 2026 cycle is up 1.6% through September 24th.
The Fed described the economy as expanding at a solid pace, with resilient spending, strong productivity and robust capital investment. Those same conditions support growing corporate earnings while higher borrowing costs work through the economy.
What matters from here is why the Fed is hiking, and whether economic growth can absorb the higher cost of money.
Until next week,
Jacob
Sources & method
Cycle dates: Federal Reserve Bank of St. Louis, Fed Tightening Episodes Since the 1980s.
September 2026 policy context: Federal Reserve, September 16, 2026 FOMC statement.
Historical market paths: Financial Modeling Prep S&P 500 daily closes; Fjell Capital calculations.
2026 market path: Associated Press closing data through September 18 and Tallac Options through September 24.
Method: Price returns run from the S&P 500 close on the first tightening-action date to the nearest trading-day close one calendar year later. Dividends are excluded. The partial September 2026 path is shown separately and excluded from the historical median.
Written by
Jacob Radke
Partner, Wealth Advisor
Jacob writes the weekly charts. Jacob leads the firm’s platform, including trading, research, portfolio systems and technology. He also sits on the firm’s board and investment committee, and advises client families.
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