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Category: Funds
Dividend Stock News For May 20, 2010
Dividend Stock News For May 20, 2010

The Latest in the World of Dividend Investing

Dividend Stock News For May 20, 2010

About: Safeway (NYSE: SWY), Dominick's, Safeway, Vons, Ashland (NYSE: ASH), Ashland Chemical, Hercules Chemical, Dow Jones  U.S. Select Dividend Index, Zenith National Insurance (NYSE: ZNT), H.J. Heinz (NYSE: HNZ), Fairfax Financial (NSYE: FFH), GoldCorp (NYSE: GG), GoldCorp
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Dividend Stock News For May 20, 2010
Supermarket operator Safeway (NYSE: SWY) announced a payout increase dividend shoppers may want to take a look at. The California-based company said it will boost its quarterly dividend by 20% to 12 cents a share. Safeway operates stores under the Dominick's, Safeway and Vons names. The new dividend is payable on July 15th to shareholders of record on June 24th.

 
Dividend Stock News For May 20, 2010
Specialty chemicals maker Ashland (NYSE: ASH) doubled its quarterly dividend to 15 cents a share from 7.5 cents. Ashland has been diligent about bolstering its balance sheet through asset sales following the company's acquisition of rival Hercules and the lower debt burden appears to be directly benefiting shareholders.

 
Dividend Stock News For May 20, 2010
The Dow Jones  U.S. Select Dividend Index will replace Zenith National Insurance (NYSE: ZNT) with H.J. Heinz (NYSE: HNZ) because Zenith is being acquired by Fairfax Financial (NSYE: FFH). The change will take place on May 21st. The index tracks the 100 highest dividend-paying companies in the U.S.

 
Dividend Stock News For May 20, 2010
Canadian gold miner GoldCorp (NYSE: GG) said it will consider boosting its dividend in 2011 as production increases and rising gold prices are helping the company bolster its cash position. GoldCorp currently pays an annual dividend of 18 cents  a share.

 
U.S Bancorp Does The Same Dividend Dance As It Peers
U.S Bancorp Does The Same Dividend Dance As It Peers

US Bancorp Follows Dividend Footsteps of Rivals

US Bancorp Follows Dividend Footsteps of Rivals
About: US Bancorp (NYSE: USB), JP Morgan Chase (NYSE: JPM), Bank of America (NYSE: BAC), Bloomberg News, Bancorp, quarterly dividend, dividend increase, Dividend Genius, dividend stock, stock dividend, dividend stocks, stock dividends Bookmark and Share

There's something to be said for consistency and predictability and those two themes have been especially prevalent for banks during this earnings season. Last week, JP Morgan Chase (NYSE: JPM), the second-largest U.S. bank, got the ball rolling by reporting solid first-quarter earnings, helped by the improving U.S. economy, few bad loans and the need to set aside less cash for non-performing loans. Bank of America (NYSE: BAC), the largest U.S. bank, made similar comments last Friday.

On Tuesday, US Bancorp (NYSE: USB) followed in the footsteps of its bigger rivals. US Bancorp isn't a big presence in the capital markets or investment banking the way BofA and JPMorgan, but it should be noted that even though the Minnesota-based bank and Warren Buffett favorite took TARP money, it was also diligent in repaying those funds. We said last year that we viewed the bank as one of the stronger and more financially sound institutions in the U.S. and Tuesday's earnings report certainly solidifies that view.

Of course, this is a bank we're talking about and USB has plenty in common with its larger rivals, especially when it comes to looking like its primed to raise the dividend that it slashed in the first quarter of 2009 and not doing so...yet. It appears USB will raise its dividend at some point, but CEO Richard Davis said he'd like to see the economy gain more strength and wait for capital guidelines from Uncle Sam before boosting the payout.

On the bright side, Davis did say his bank does have the earnings to support a higher dividend. At the same time, no time-frame for a higher payout was given. If nothing else, these banks are becoming annoyingly consistent and predictable in defense of their paltry payouts.

 
Don’t Misread China’s New Trade Deficit
Don’t Misread China’s New Trade Deficit

Don’t Misread China’s New Trade Deficit

China’s new trade deficit, booming Chinese economy, Chinese Customs Administration, China’s president, Hu Jintao, Jim Trippon, China's equity markets

About:China’s new trade deficit, booming Chinese economy, Chinese Customs Administration, China’s president, Hu Jintao, Jim Trippon, China's equity markets
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It would be a mistake to regard China’s new trade deficit, the first in six years, as a sign of any new economic weakness. Take a look more closely at the numbers and a picture of a booming Chinese economy continues to emerge.

China exported an impressive $112 billion worth of goods and services in March. That is up 24 percent year over year.

Imports surged even more, up 66 percent year over year to $119 billion. China’s voracious consumption of imports resulted in a trade deficit of $7.24 billion. The resulting one-month deficit was the nation’s first since it posted a much smaller deficit in April of 2004.

What do the numbers show us so far? First of all, we see that China’s participation in global trade continues to expand at a double-digit rate. Combining both imports and exports, China's total foreign trade rose 42.8 percent year over year to $231 billion in March of 2010.

Clearly China is continuing to act as the engine of global recovery. China’s enormous demand for foreign goods and raw materials boosted imports to new levels.

Surging importation of commodities such as oil, iron ore and copper increased total import spending by 15.3 percent. Vehicle imports rose 240 percent year-over-year to $3.2 billion. Shrinking exports of labor-intensive Chinese products also contributed to the rare deficit.

China’s new trade deficit, booming Chinese economy, Chinese Customs Administration, China’s president, Hu Jintao, Jim Trippon, China's equity markets

In other words, weak global economic conditions have lowered demand for high-value Chinese products, while Chinese consumption and demand have increased.

The Chinese Customs Administration posted the following commentary on its website: “Neither is the March deficit a recession, nor can it sustain,” adding that the deficit was relatively small and that China has maintained a “basic balance” between imports and exports.

That’s true. Looking at the trade balance for the entire first quarter of the year, China's January to March total imports and exports rose by 44 percent to $617 billion.  So, for the first three months, China is still posting a trade surplus of $14.5 billion.

It’s worth noting that the 2010 first quarter surplus was down sharply by 76 percent from the same period of a year ago.

The Chinese government says it will be content with balanced global trade, although China’s trade surplus with the U.S. remains higher than with its European or Asian trading partners.

China’s president, Hu Jintao is currently in Washington for an international nuclear summit and he is expected to have further meeting with U.S. lawmakers about the controversial valuation of the yuan. There can be little doubt that the first quarter trade deficit and declining trade surpluses will tend to ease international pressure on China to radically revalue the yuan.