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Pro Analysis

Record buybacks fail to lift S&P 500

weight lifter struggling to lift
Robert Benson | Getty Images

U.S. companies in the S&P 500 bought their own stock at a record pace the 12 months ending in March, new data show, but the buyback tidal wave did little to lift the stock market as the benchmark was actually down about 1 percent during the period.

During the March 2015 to March 2016 period, U.S. companies spent a record $589.4 billion in share repurchases, according to figures released Wednesday by S&P Dow Jones Indices. That eclipsed the previous record of $589.1 billion set during the market peak in 2007.

In the first quarter, share repurchases totaled $161.4 billion, up 12 percent from the fourth quarter of 2015 and the second highest quarterly buyback total ever.

Companies also continued spending on dividends as total shareholder return, which counts buybacks plus dividends, was at a record level for the first quarter and the previous 12 months, according to the firm.

Cash reserves for nonbanks in the benchmark rose 1.6 percent to a record $1.35 trillion. The prior record came at the end of 2014 when S&P 500 industrial members held $1.33 trillion, according to S&P.