Friday's stock advance had investors banking on more fiscal stimulus from the government, but other possible congressional action had Standard & Poor's Index Services cutting its projected dividend rate on the S&P 500.
"Due to recent events, including potential congressional action that might limit dividend payments, we are reducing the indicated dividend rate on the S&P 500," said Howard Silverblatt, senior index analyst at Standard & Poor's.
However, hopes for quick congressional passage on an economic-stimulus plan helped propel equities higher Friday, with an ugly January unemployment report proving less dire than many feared.
The Dow Jones Industrial Average (DJI) gained 217.52 points, or 2.7%, to 8, 280.59, up 3.5% for the week. The S&P 500 (SPX) rose 22.75 points, or 2.7%, to 868.60, a weekly rise of 5.2%, while the Nasdaq Composite (RIXF) added 45.47 points, or 2.9%, to 1,591.71, up 7.8% from last Friday's close. .
Standard & Poor's Index Services said Friday that it expects S&P 500 dividends to decline 13.3% in 2009, the worst yearly drop since 1942, when dividends fell 16.9%.
Standard & Poor's now expects $214.66 billion in dividend payments for S&P 500 companies in 2009, compared to $247.9 billion last year.
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