Embattled investors will be rewarded
with a bumper spring payday despite the worst quarter for global stocks in
years.
Dividends are set to soar to as
much as $400bn (£285bn) in the coming months, easing the pain caused by a turbulent
start to the ear on markets.
Wall Street analysts estimate
that dividends could climb to a monthly record of $174bn in May. Payouts are
expected to be driven higher by buoyant global growth and the savings generated
from Donald Trump’s huge corporate tax cuts.
Morgan Stanley calculated $400bn
is set to be paid into investor accounts between March and May in what is typically
a high season for dividend payments.
The investment back argued that
the payout will provide “some welcome (temporary) relief” for investors amid a
surge in volatility on markets.
A dividend boost will help to
bolster investor’s returns after the global Bull Run struggled to maintain its
momentum in 2018. The FTSE 100 suffered its worst quarter since 2011 in the
first three months of the year, slipping 8.2%, while the Dow Jones – the US
blue-chip index – snapped a nine-quarter winning streak.
Stocks have tumbled this year
amid fears central banks will tighten monetary policy more quickly than
anticipated. The prospect of tit-for-tat tariffs between the US and its major
trading partners becoming a full-blown trade war has also made investors
nervous.
