China and the US Set Dividend Records: Outlook for 2025
Dividend growth in 2024 underscores the strength of major global economies. Despite geopolitical and economic tensions, this trend is expected to continue into 2025, supported by a favorable environment for corporate profitability.
In the third quarter of 2024, global dividends reached a record $431.1 billion, marking the highest figure ever for this period. While the 3.1% growth rate represented a slowdown compared to the 6.6% underlying increase in the first half of the year, key sectors and regions showcased significant contributions.
China: A Driving Force in Dividend Growth
China’s leadership in dividends was particularly evident in the technology sector, with contributions totaling $44.6 billion. Notably, Alibaba (BABA) began paying dividends in 2024, introducing a regular payout alongside a special dividend of $6.8 billion, positioning it alongside PetroChina as the country’s second-largest dividend payer.
BYD (BYDDF), the electric vehicle manufacturer, also set a dividend record, reflecting its commercial success both domestically and internationally. According to the Janus Henderson Global Dividend Index, the third quarter is crucial for Chinese firms, as many make annual payments during this period.
Despite broader economic challenges, Chinese dividends grew 12.3% on an underlying basis and 15.4% overall, solidifying the country’s influence in emerging markets.
United States: A Surge Led by Tech Giants
In the United States, underlying dividend growth reached 10%, significantly outpacing the global average. A substantial portion of this growth came from Meta (META) and Alphabet (GOOG), which paid dividends for the first time, accounting for nearly a quarter of the increase.
Additionally, companies like Disney resumed payments after suspensions during the pandemic.
Key Takeaways for 2025
The momentum in dividend payouts reflects a resilient corporate sector that continues to adapt to challenges. In China, the focus remains on sectors like technology and electric vehicles, while the US sees strong contributions from tech and the resumption of dividends in other industries.
For investors, these developments suggest a promising outlook for income generation in 2025, with growth driven by innovation, corporate strength, and an evolving global economy.
Projections for 2025 remain optimistic. While the “Trump effect” and associated policies may introduce economic uncertainties, they are also seen as opportunities to reshape market dynamics in favor of long-term investors.
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