Investors wary of rising bond yields and the return of inflation that has been lacking since the 2008 financial crisis may find protection in one corner of the stock-market: the utilities and consumer staples sectors.

Both are typically defensive sectors and make up a combined 9% of the S&P 500’s $33.27 trillion market cap, the lowest since the 2000 dotcom bubble.

“If macro boom consensus correct then yields up another 50-100bps = higher volatility = defensives good market hedge” in the first half of this year, wrote Michael Hartnett, chief investment strategist at Bank of America.

NASDAQ IN CROSSHAIRS AS DOT-COM BUBBLE THREATENS REPEAT

In the second half of the year, defensives will prove to be a “good macro hedge as global PMI's & US consumer spending peak,” he added.

The 10-year Treasury yield has climbed 72 basis points this year, closing at a 13-month high of 1.63% on Friday.