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Stock Markets: The Easy Money Boom Is Completing

But as the global economy slows, dividend growth has returned to Earth.

"Throughout the year, we have warned investors that the rapid growth in earnings that it has enjoyed over the last few years has been set to return to more normal levels," Asset Manager Janus Henderson said in a report released Monday.

The firm found that the softness in the global economy was beginning to hit corporate earnings and thus dividends, a trend that began in the second quarter and penetrated into the third, until the company finalized its prospects for 2020, expecting more than after

"We just have very low growth, a weaker economic environment," Jane Shoemake, Global Investment Income Investment Director, told me.

Shoemake pointed out that even in this environment, companies "still generating some decent money." Energy companies that restructured when oil prices were lower, for example, fueled recent growth.

Numbers: Janus Henderson expects dividend payments to grow 3.9% in 201

9 compared to last year. They are still projected to reach a record $ 1.43 trillion.

Big Picture: In 2017, the world was experiencing synchronized economic growth, while in 2018, the corporate profit bonus was fueled by the high sugar of US tax cuts. That would not go on forever. Economic growth may continue to increase, but easy returns from recent years have become increasingly difficult. Stock buying is also slowing down.

Aramco's more modest IPO can still dethrone Alibaba

Saudi Arabia estimates its massive oil monopoly is worth 1.7 trillion. sought by Crown Prince Mohammed bin Salman but tall enough to break the record for a record IPO before the end of the year.

  World's Most Valuable Company: Saudi Arabia puts a $ 1.7 trillion price tag on its oil monopoly

On Sunday, Saudi Aramko said it aims to sell 1.5% of its 200 billion shares in partial privatization for between 30 rials ($ 8) and 32 rials ($ 8.53) each.

At a higher price, Aramco will not reach the largest IPO. That would raise more than $ 25 billion by taking the crown from Alibaba's public debut in 2014.

That's not all. With an estimated $ 1.6 trillion to $ 1.7 trillion, Aramco would be the most valuable company in the world. Currently, this title belongs to Apple worth $ 1.18 trillion.

However, this victory is overshadowed by the fact that the IPO is more modest than originally advertised. Low oil prices, the climate crisis and geopolitical risk have raised skepticism among international investors and could force the Saudi Kingdom to rely on affluent local families, sympathetic sovereign wealth funds, or large clients such as China, which is a stockbroker.

: The stock price will be set on December 5, with the Saudi Stock Exchange expected to start trading later that month.

Stocks are back in fashion

In August, the world's largest wealth manager told clients it was time to sell stocks – the first time since the crisis in the eurozone to give this advice.

UBS is now retreating from its bear warning. This is further evidence of investors' recent thinking that slowing economic growth does not indicate an oncoming recession, giving stocks more time to execute to rise.

The bank now believes that the shares should form a standard part of investor portfolios. This is not exactly a bullish position, but it is far less gloomy.

Mark Hefele, Chief Investment Officer of UBS Global Wealth Management, cited four reasons why the bank is more optimistic in a recent note to clients: 1) Progress in US and China trade negotiations, 2) increased incentive from central banks, 3) more reasonable expectations about corporate profits and 4) indicative signs that the economy is stabilizing.

Preventing a direct upward position is trade insecurity. "Of course, we have to admit that geopolitical gains can quickly evaporate," Haifele wrote, noting that President Donald Trump claims he "disagrees" with China.

Until next

] Data on US capital flows for September arrive at 16:00 ET.

Coming Soon Tomorrow: Fresh Data on the US Housing Market.

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