The Bank of Canada (BoC) moved to increase its overnight rate to 1% with a 50-basis point interest rate hike on April 13, 2022. This move was in line with analyst expectations as policymakers have been pressured to make the move due to soaring inflation. Markets have been hit by volatility in the second half of April. However, there are still some top TSX stocks that are worth targeting after the rate hike.
Royal Bank (TSX:RY)(NYSE:RY) is the largest Canadian bank and the biggest stock on the TSX by market capitalization. Shares of this bank stock were down 1.8% in early afternoon trading on April 25. The stock is now down 4.7% in the year-to-date period.
This top bank should see its profit margins improve due to rising rates in the months ahead. It already had a strong start in the first quarter of 2022 as net income increased 6% year-over-year to $4.1 billion. Royal Bank stock possesses a solid price-to-earnings ratio of 11. Investors can also rely on its quarterly dividend of $1.20 per share. That represents a 3.6% yield.
Sun Life Financial (TSX:SLF)(NYSE:SLF) is a top insurance and financial services provider. This is another company that will see its profit margins boosted by higher interest rates. Shares of Sun Life have dropped 7.4% so far in 2022. It now possesses an attractive P/E ratio of 9.8. Investors may want to consider snatching up Sun Life on the dip in this choppy market.
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