S&P 500 dividends seen dropping 1% in 2020
(Reuters) – S&P 500 dividends are prone to fall about 1% this yr, a lot lower than beforehand anticipated, as corporations reinstate beforehand suspended funds as they develop into extra assured about recovering from the coronavirus, in keeping with S&P Dow Jones Indices.
(GRAPHIC: S&P 500 dividends on monitor for minor 2020 decline – )
S&P 500 .SPX corporations slashed or suspended over $40 billion in dividends within the second quarter, the deepest quarterly drop since 2009.
However cuts tapered off mid-year because the U.S. financial system started to rebound and a few corporations reinstated their dividends, whereas Microsoft (MSFT).O in September hiked its dividend by 10%.
Consequently, dividends paid by S&P 500 corporations are prone to finish 2020 at $479.5 billion, in comparison with $485.5 billion final yr, in keeping with S&P Dow Jones Indices. Though smaller than anticipated, the annual decline would nonetheless be the primary since 2009 in the course of the monetary disaster.
S&P Dow Jones Indices’ latest projection is a serious enchancment from earlier in 2020, when analysts anticipated the pandemic to end in as a lot as a 10% annual decline in dividends.
“Last year was a record year. This year your paycheck is going to be down 1%,” mentioned S&P Dow Jones Indices analyst Howard Silverblatt. “You can cry, but I’m not feeling sad for 1%.”
Reporting by Noel Randewich; Enhancing by Nick Zieminski
Market information on CNN.