Market & Economic Commentary

In March, the dividend-payers (400) in the S&P 500 (equal weight) posted a total return of 2.30%, vs. 2.06% for the non-payers (100), according to Standard & Poor's. Year-to-date through March, the payers were up 11.43%, vs. a gain of 16.53% for the non-payers. For the 12-month period ended March, payers were up 5.76%, vs. a loss of 0.53% for the non-payers. The number of dividend increases y-t-d totaled 122, up from 84 a year ago. Three dividends were cut, up from zero a year ago. Seven companies initiated a dividend, matching the seven through Q1’11.

Approximately 7,000 publicly owned companies report dividend information to Standard & Poor's Dividend Record. In Q1’12, dividend increases totaled $24.2 billion, a 27.4% rise from the $19.0 billion worth of increases in Q1’11, according to S&P. In Q1’12, S&P Indices reported 677 dividend increases, up 32.7% over Q1’11’s 510 increases. The number of dividends decreased in Q1’12 totaled 31, up slightly from 30 decreases in Q1’11. Howard Silverblatt, Senior Index Analyst at S&P Indices, reported that individual investors will have saved $358 billion on qualified dividend tax cuts from 2003 through the 2012 expiration date.

A recent survey of small businesses by the National Federation of Independent Business found that 57% of firms have made a capital expenditure in the past six months, the largest percentage since March 2008, according to Businessweek.com. Of those that made purchases, 63% bought new equipment and vehicles. Tobias Levkovich, chief U.S. equity strategist at Citigroup, reported that capital spending projections for the 735 nonfinancial companies the firm follows has been raised from a 6% increase (y-o-y) to nearly 11% for 2012. Levkovich notes that increases in capital spending tend to be accompanied by hiring.

Good Friday Holiday - Markets Closed.