New analysis from strategists at The Kobeissi Letter indicates that the S&P 500 has, on average, declined by 4.0% in the six weeks following the first Fed rate hike of a cycle, based on seven episodes since 1988. However, stocks typically recovered all losses in the subsequent five to six weeks, with average returns of 4.0% after six months and 9.0% after 12 months. Strategists note that Fed rate hikes have historically been great buying opportunities. Markets widely anticipate a 25 basis point interest rate hike at today's Federal Reserve policy meeting, which would be the first since July 2023.