Your Stocks Could Feel the Fed’s Rate Hike Next, Jim Cramer Warns

Jim Cramer mentioned the impression of upper rates of interest is his massive concern for the inventory market proper now. The Mad Money host raised the concern about 2 weeks after the Federal Reserve resumed climbing.

His warning got here throughout a Thursday overview of the third quarter, when software program shares rebounded and chip names cooled. He referred to as software program’s comeback the defining inventory market story of that quarter.

“My massive concern proper now’s the impression of upper rates of interest on the inventory market,” Cramer said.

The Fed Turned the Dial Back Up

The Federal Reserve raised its goal vary 1 / 4 level to three.75% to 4% on September 16. The decision marked its first improve since 2023.

The Fed mentioned the transfer helps a timelier return to its 2% inflation objective. US Personal Consumption Expenditures (PCE) inflation cooled to 3.4% in August, nonetheless properly above that concentrate on.

Fed projections additionally confirmed 16 of 18 individuals anticipating at the least another hike this 12 months. J.P. Morgan sees that transfer coming in December, although it expects no long tightening cycle.

Futures merchants largely count on a pause on October 28, with CME FedWatch displaying 75.1% odds of no change. By the December 9 assembly, nevertheless, the odds of a better goal vary climb to 79.4%. 

Most of that chance, 61.3%, sits on a single quarter-point transfer to 4% to 4.25%.

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Home Depot Shows Where the Pressure Lands

The hike has weighed on rate-sensitive shares corresponding to Home Depot. Market knowledge exhibits the retailer down over 6% between September 16 and October 1. Its shares have now misplaced over 18% since the begin of 2026.

Borrowing prices have additionally climbed in the bond market. The 10-year Treasury yield ended October 1 close to 5.24%, up from roughly 4.16% at the begin of 2026. Ex-Dallas Fed chief Robert Kaplan says merchants value a premium tied to Fed Chair Kevin Warsh into yields.

Those pressures haven’t but dragged down the broader market, with the S&P 500 up about 12% in 2026. Cramer mentioned the coming earnings season ought to give a clearer learn on how costlier borrowing is affecting corporations.

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