The Best Stocks To Invest In Right Now

Thus far the year 2024 has shaped up to be one of the most prolific stock market investment years on record. This year has featured high rates of inflation and the highest interest rates in more than 15 years but the stock market (S&P 500) has continued to set new highs. The best stocks to invest in right now may be obvious as we are in a typical bull market which sees the index rise without resistance.

A Similar Pattern

This particular market environment is not unique in recent history. The last time that interest rates were at 3% and then moved above 5% was from May 2005 – Sept 2007, at that time rates of inflation were similar to rates today (above 3% for most of 2005 through 2007). During that period the S&P 500 rose roughly 30% which is similar to the 23% gain posted from Sept 2022 – May 2024; this was also a time when interest rates started at 3% and then moved above 5% (in May 2023) and held steady for another year.

Stocks that performed well from May 2005 – Sept 2007 were those that were at the front of the index as the S&P 500 witnessed a magnificent bull market. More specifically, these particular sectors were standouts in the high interest rate and inflation environment of that time:

S&P 500 Energy Index: 84.2%
S&P 500 Materials Index: 58.1%
S&P 500 Industrial Index: 36.6%
S&P 500 Info Tech Index: 35%

In comparison to today’s high interest rate and inflation environment, the top performing S&P 500 index’s from Sept 2022 – May 2024 were as follows:

S&P 500 Info Tech Index: 68%
S&P 500 Industrial Index: 29.5%
S&P 500 Materials Index: 17.7%
S&P 500 Energy Index: 13.5%

The best combined performance over these two periods is undoubtedly S&P 500 energy stocks, followed by info tech and material stocks. It’s possible that investing in these particular S&P 500 indexes could provide similar returns in similar situations in the future.