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Buybacks Are Boosting the Market


Video Transcript

This is a trailing 12-month list of stocks just to show the massive amount of money that companies have been putting into these stock buybacks. You can see in the past 12 months, ExxonMobil (NYSE:XOM) has put $21 billion into buying shares of its stock, American International Group (NYSE:AIG) put in $13 billion, Johnson and Johnson (NYSE:JNJ) put in $12 billion and AT&T (NYSE:T) put in $12 billion.

As you look at these names, you’ll see many components of the Dow Jones Industrial Average and many components of the S&P 500. Even if they’re not part of the Dow, they are components of the S&P 500. In a time when we may have some investors stepping back from the market wondering how high this bullish run can go, we have a lot of these companies that have announced their share buyback programs that are steadily buying shares.

It doesn’t matter to them so much where the price of the stock is. They’re not trying to time their entries; they are trying to execute a program to invest a certain amount of money into the share buybacks. So, we have this steady stream of buyers coming along, and that is helping. We also have a steady stream of central banks that continue to pump a lot of money into the markets.

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