India, Aug. 31 -- US stocks have had a strong run in 2026, but a correction risk is now growing. The S&P 500 has gained about 13%, while the Nasdaq Composite has risen around 14% through the first eight months of 2026. Both major indexes are on track for another year of double-digit gains.

If the gains continue, the S&P 500 and Nasdaq would record their fourth straight year of double-digit growth. But the stock market rally could now face a major test. Inflation is staying high, and this could push the Federal Reserve to raise interest rates again.

Higher interest rates are a problem for stocks. Rate hikes can make borrowing more expensive for companies and consumers. They can also make bonds and other safer investments more attractive ...