FX.co ★ US companies to buy back stocks worth $209 billion

According to MarketWatch with reference to the report from research firm EPFR, in April 2021, several US corporations announced stock repurchases worth $209 billion. Analysts suppose that this reading is the second largest after the Trump administration’s tax overhaul.

In June 2018, after the tax reform conducted by then-President Donald Trump, stock repurchases totaled $218 billion.

Notably, Donald Trump slashed the corporate tax rate to 21%. Winston Chua, an analyst at research firm EPFR, said that in May, most companies continued repurchasing their stocks. Experts suppose that this tendency will take place for several weeks and then, it will come to an end.

“Historically, share buybacks have a high correlation to the S&P 500 index,” Chua told MarketWatch. “But it’s not a pace that can be sustained.”

Estimates provided by EPFR unveiled that in recent months, buybacks have been climbing along with the S&P 500. On April 29, it reached its new high, jumping by 11.9% in the year.