Don't expect high payouts this quarter, Markit warns, as global dividend growth looks set to stall in the last three months of 2015.
Investors should only prepare for a 1.8 percent rise in dividend payments — a far cry from the 8.8 percent boost seen last year — led by fewer payouts from European and Asian firms, a report by the dividend forecasting unit of financial information services firm explains.
Excluding Ireland and the U.K., European dividends are expected to fall by over 1 billion euros ($1.1 billion) this quarter.
Still, a total of up to $193 billion should be paid to shareholders in the fourth quarter, with $101 billion to be distributed by U.S. companies, $46 billion by European firms, and $45 billion from those in the Asia-Pacific region.
Despite firms like Visa, MasterCard and Starbucks set to follow through with major dividend increases this quarter, top U.S. companies in sectors including basic resources, media, healthcare and technology are expected to drag down U.S. dividend growth to 3.4 percent from previous forecasts of 12.3 percent.
Ordinary dividends from Europe excluding the U.K., meanwhile, are set to fall by 4.3 percent to 23.9 billion euros ($25.8 billion), pulled down by a 2.3 billion euros ($2.5 billion) drop in dividends from Russian basic resources firms. Spanish dividends, which usually account for 30 percent of all European payouts, are expected to fall 0.5 billion euros ($0.56 billion), mostly due to Santander's planned dividend cut.
However, both German and U.K. stocks are holding their own, with Germany expected to contribute 4 billion euros ($4.4 billion) toward the total global dividend pot, up 10 percent from a year earlier.
Markit also believes U.K. companies like HSBC, Royal Dutch Shell and Vodafone will protect shareholder payouts, despite market conditions that nearly wiped out year-to-date gains in a sell-off this summer.
BP also seems to be shielding investors —despite feeling pressure from low crude prices that are still hovering around $50 per barrel — and is forecast to maintain dividends.
But the picture isn't so rosy for those invested in firms from the Asia-Pacific region, which are set to offer 5.5 percent less in payouts this year at $45.5 billion.
Two-thirds of Asia's payouts are expected to come from Japan, and 20 percent from Australian firms — most of which will come from Aussie banks.