The Globe and Mail reports in its Wednesday edition that following Donald Trump's election victory, shares of many classic dividend payers -- including utilities, pipelines and telecoms -- got clobbered in a sell-off that some say was long overdue.
The Globe's John Heinzl writes that Fortis, Enbridge and BCE are among the hardest-hit stocks. For dividend investors
who have gotten used to
watching their stocks go only one
way -- up -- the reversal has served
as a wake-up call that even the
strongest, most reliable businesses
are vulnerable to the changing
political and economic winds.
The main reason cited for the
sell-off is that president-elect
Donald Trump's vow to boost infrastructure
spending is stoking worries
about inflation, which in turn is
driving up government bond
yields. The yield on Canada's 10-year government bond
has surged to more than 1.5
per cent from about 1.2 per cent
before the election. Every asset class hits a rough
patch occasionally, and dividend
stocks are no different. They have
posted such strong gains in
recent years that they were ripe
for a pullback.
Analysts see nothing alarming
in the recent sell-off and recommend
dividend investors stay
the course.
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