Global Dividends Set for a Record Year After a Bumper Quarter

(Bloomberg) -- Cash-rich companies and a recovering economy are putting global dividends on track for a record year, according to Janus Henderson Investors.

The money manager is raising its estimate for total payouts to $1.46 trillion this year, a faster rebound than forecast in their last report and a sign that balance sheets are getting stronger and boardrooms less cautious. 

Miners were the biggest drivers of dividend growth in the past quarter, benefiting from soaring commodity prices and making BHP Group Plc the world’s biggest dividend payer in 2021. They probably won’t keep the top spot, though. 

“It seems unlikely that mining companies can sustain this level of payouts given their reliance on volatile underlying commodity prices -- some of these have already fallen,” said Jane Shoemake, client portfolio manager on the global equity income team at Janus Henderson. Instead, “a big driver for 2022 will be the ongoing restoration of banking dividends.”

Income strategies have returned to the spotlight as soaring inflation expectations and rising yields make high dividend payers more compelling for investors. It’s one reason why JPMorgan Chase & Co. strategists raised U.K. equities to overweight for the first time since the Brexit referendum last week.

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