(UnitedVoice.com) – When the coronavirus pandemic hit early this year, many companies circled the wagons and hung on to all the cash they could. Now they’ve started to hand it out again in what analysts believe is a sign of business confidence that the crisis has passed its worst.
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When the economy started to close down in March, some of the largest US businesses – including 42 from the S&P 500 index – slashed their investment activity and stopped dividend payments on their stock. Faced with huge uncertainty, they wanted to make sure they kept their cash reserves as large as possible, but now it looks like they’re loosening the purse strings again.
In the last few weeks, six of the biggest companies that suspended dividends have restarted payments. They include General Motors, Marathon Oil, Gap and Kohl’s. Mark Zandi, chief economist at financial firm Moody’s, says this is a sign executives think economic recovery is gathering pace.
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