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Friday Email: 15 February 2013

Every Friday morning our lead analyst Mark Riding sends out his weekly run-down and upcoming events in the investor calendar, like this one:

It has been a funny old market this last week. It just does not want to go down. Every time the market looks like it is going to blow up, it just bounces back again. The FTSE fell about 30 points yesterday after falling further earlier in the day, but recovering after better than expected US jobs figures. However, it is difficult to ignore poor GDP figures around the globe. The market will not go up in a straight line and it goes without saying that at some point it will correct.

From a dividend perspective, the garden remains very rosy. Companies have been hoarding cash for years and continue to up the payouts to their shareholders. This weeks key declarations below:

Barclays up 8.3%

Dunelm up 12.5%

Reckitt up 11%

Rio up 18% in sterling terms

Amec up 20%

Rolls Royce up 11.4%

Morgan Crucible up 8%

Shire up 18%

Anglo American up 18% in sterling terms.

No dividend cuts this week. The reporting season ploughs on next week at about the same rate as the week just gone, before erupting the following few weeks with most of UK plc reporting. It is the busiest time of the year for dividends as most of the declarations are for final dividends and the optimizer calculations start to crystalise with the three dividend optimizer coming into its own with two finals and an interim for lots of stocks.

We could do with a market correction as this can send the yields up very nicely. I noticed that Man group has really moved recently and I may take the opportunity to sell our position in the trading portfolio today. What a steal that has proved to be and we will bank a total return of over 40%. It was under water for most of the year, but the December purchase at 74.6p was good. The earlier purchase in the low 90's in now looking good and that has had some good dividend payments. It is tempting to hang on for the 8p dividend but we don't want to be greedy. The optimizer is a powerful beast and it still sits high in it, yielding over 12%, but that is down from 25% and analysts are predicting that the dividend will be cut next year reducing the yield dramatically.

This email was originally sent on Friday 15 February 2013

The Friday email is delivered to over 20,000 subscriber’s every week, and remains a widely read run-down of recent events and what investors can expect in the week ahead written by our chief analyst Mark Riding.

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