Morgan Stanley says stock market may break down again so buy these top dividend payers

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Stocks that promise dividend income offer a good opportunity for investors who have a hard time riding out market turbulence.

Markets could remain under pressure through the end of the year, and high dividend stocks are one option to help investors through the uncertainty, according to Morgan Stanley. Mike Wilson, the firm's chief investment officer and equity strategist, said the combination of higher rates and cyclical uncertainty could weigh on the stock market through the rest of the year – despite the recent correction from what he deems a false breakout in the S & P 500 from May to July.

9% for MPLX, a master limited partnership created out of Marathon Petroleum that operates crude oil and refined product pipelines. Dividends are secure in the tobacco sector, which is cash generative, has limited need for capital spending, relatively low leverage and prioritizes dividends as a use of capital, Wilson said. The bank's preference in tobacco is Philip Morris , whose 2024 dividend yield could be 5.5%, according to Morgan Stanley.

 

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