“Corporate buybacks have surpassed the $1 trillion mark for the first time since 2009, a sign the credit boom is reaching new heights, according to Brian Reynolds, chief market strategist at Rosenblatt Securities.
“Buyback announcements for the S&P have now topped the trillion dollar mark for this credit boom. And even though this boom is about to begin its fifth year, this past month has seen the fastest growth for buyback announcements, as if CEOs are making up for lost time,” Reynolds said in a note on Wednesday.
(Read More: Is Corporate Behavior Too Bubblicious in Bond Market?)
He said buybacks, where a company repurchases its own outstanding shares to reduce the number of shares in the market, have helped boost share prices.
“Buybacks have been the main driver of higher equity prices during the current credit boom, which began in 2009, as all other major stock market participants combined have been net sellers.”
Since March 2009, the S&P 500 has risen from its low of 676 to Wednesday’s close of 1541, an increase of almost 104 percent….”
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