The dollar spiked higher versus the euro on Thursday, a move that should boost domestically focused stocks but hurt large multinationals such as Caterpillar, if history is any guide.
The euro sank about 1 percent against the dollar after the European Central Bank announced plans to trim its monthly asset purchase program. The bank noted that the program could be extended again if economic conditions turn sour.
But if the dollar's strength over the euro continues, investors may be looking to make some key trades here in the U.S. A weakening euro reduces the purchasing power of Europeans to buy U.S. exports, giving a competitive advantage to companies that tend to sell domestically.
Using hedge fund analytics tool Kensho, CNBC analyzed 10 years of historical trends each time the euro fell 2 percent or more against the dollar in one month. That has happened more than 50 times over the past decade.
During those months, here's what happened to the overall market:
The data show that both the S&P 500 and the Dow Jones industrial average tend to trade positive as the euro declines.
Companies such as United Health and Home Depot that typically serve the U.S. market are among the biggest gainers. Both stocks were up about 0.2 percent Thursday after the greenback gained ground over the euro. Boeing, which led the Dow higher Thursday morning, also tends to benefit from a weaker euro.
But there are also losers that accompany a stronger dollar, as Europeans are forced to pay more for imported goods and services as the exchange rate moves. U.S. companies that conduct a significant portion of their business overseas, such as Caterpillar, tend to post negative returns as the cost to import American goods rises.
Disclosure: NBCUniversal, parent of CNBC, is a minority investor in Kensho.