---
title: "Markets weigh Fed hike risk as S&P 500 gains 8.5% YTD"
type: "News"
locale: "en"
url: "https://longbridge.com/en/news/286983622.md"
description: "The S&P 500 has gained 8.5% year-to-date, rebounding from early losses despite geopolitical and inflationary challenges. With inflation reaching a three-year high, the likelihood of Fed rate hikes has increased, shifting expectations from cuts. Key sectors to monitor include energy, financials, and real estate, which may excel if inflation remains elevated and the Fed tightens its policy."
datetime: "2026-05-20T01:01:18.000Z"
locales:
  - [zh-CN](https://longbridge.com/zh-CN/news/286983622.md)
  - [en](https://longbridge.com/en/news/286983622.md)
  - [zh-HK](https://longbridge.com/zh-HK/news/286983622.md)
---

# Markets weigh Fed hike risk as S&P 500 gains 8.5% YTD

Market’s strong rebound: The S&P 500 has recovered from early-year drops to post an 8.5% gain despite geopolitical and inflationary pressures. Fed policy shift: Rate hike probabilities have risen sharply as inflation hits a three-year high, reversing earlier expectations of cuts. Sectors to watch: Energy, financials, and real estate could outperform if inflation stays high and the Fed tightens policy.

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