The Financial Post reports in its Tuesday edition that RBC Capital Markets research shows higher rates are good for equities. The Post's John Shmuel writes that RBC chief United States market strategist Jonathan Golub says as long as interest rates are rising from "subdued levels," higher rates are positive for stock valuations. His research found the S&P 500 has averaged a 15.5-per-cent return on days when the 10-year treasury yield has risen. On days when it has fallen, stocks have experienced a 1.1-per-cent decline on average. The return has been 2 per cent when yields have been flat. The research also found that financials and cyclicals were the most sensitive to rising yields, returning 22.2 per cent and 18.9 per cent on up days. Mr. Golub notes that non-cyclical stocks "do not participate" in the yield rally. Whether stocks continue to rise if the U.S. Federal Reserve hikes interest rates next year is another question. Many in the market are currently calling for a hike in the second half of 2015, though the number of economists now predicting a hike in the first half of 2015 has risen, following comments made by Fed chairman Janet Yellen last month that a spring 2015 hike is possible.