If the Federal Reserve hikes rates this year, bank stocks could be the one sector that really benefits.
Most investors might choose the State Street Financials Select Sector SPDR ETF (NYSEMKT: XLF) to add exposure
I believe the Invesco KBW Bank ETF (NASDAQ: KBWB) is the better exchange-traded fund (ETF) to buy. The U.S. inflation rate hit 3.8% in April, the highest annualized reading since May 2023. Brent crude oil prices are up more than 60% year to date.
Oil is back below $100 a barrel for now, but any further geopolitical tensions could send it back to triple-digits. December rate hike odds have climbed to roughly 50% as expectations for cuts have essentially disappeared. This inflation cycle is unusual.