The Monday note - 20 May 2019

• The FTSE 100 gained 145 points last week, closing at 7,348.6 on Friday, as a weakening pound buoyed the shares of UK companies with large overseas operations. The 10 year Gilt yield hardened to 1.04%. 
• News that Theresa May is preparing a timetable for leaving Downing Street pushed the pound down to US$1.27 on Friday, its lowest level since early January. 
• Listed companies around the world paid out a record US$263 billion in dividends to shareholders in Q1 2019, according to Janus Henderson. 
• The UK unemployment rate in March 2019 fell to 3.8% - its lowest level since December 1974. This shows that businesses were hiring in the run-up to the original March Brexit deadline.

Chief Economist comments: 

News that companies around the world paid record dividends in Q1 is telling, both for positive and negative reasons. If companies were very worried about the US / China trade war, Middle East tensions, and Brexit, they would have hoarded cash, not give it back to shareholders. However, that executives do not want to invest the money in their own businesses shows there is a lot of uncertainty out there. The money will be re-invested somewhere though, as interest rates in most major economies are below inflation. We should standby for the next wave of investment for the global economy.