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  Inflation occurs when the price of everything in the market increases except for the value of money. This means that consumers must pay high prices for items without an increase in dollar value. Inflation can be dangerous to certain stocks that depend on consumers buying power. As harmful as inflation can be for the stock market, there are several stocks that continue to perform well despite it.
  
  

Necessities

• According to the website The Motley Fool, stocks do well in companies that manufacture life necessities, such as toilet paper and cereal, during inflation. General Mills and Kraft Foods have "pricing power" or the ability to keep stable stock prices when inflation demands higher prices on goods. Consumers have no choice but to pay higher prices because they need those everyday items for themselves and their families.
  
  

Companies with Brand Loyalty

• Brand loyalty can protect stocks for companies under inflation conditions. Stocks for brands such as Pepsi and Coca-Cola perform well during inflation because of consumer loyalty. Many consumers find ways in their daily life to cut costs in order to afford brand-name items they want to continue to enjoy. The same could be said of cigarette companies that have endured price increases over the years caused by state taxes and artificial inflation. The stocks in these companies survive while consumer spending is stable.
  
  

Commodities

• According to Jim Jubak, an MSN Money analyst, commodity stocks remain solid during periods of inflation and can in some cases turn a profit. Commodities include gold, other precious metals, real estate, and oil and gas. Gold, copper, and nickel do well during inflation because they are tangible--people can see and touch them. They know that the market won't be overflowing in such metals and that the demand won't go down. In addition, real estate has been a strong hedge against inflation. Ways to invest through the stock market include real estate investment trusts or REITs and purchasing shares of stock in large amounts of property and land owned by agriculture and homebuilder companies. On the other hand, the price of oil can outpace gasoline prices, causing an oil company's stocks to fall during inflation.