Where Investors Can Still Find Dividend Growth in 2026

• 31% of global companies increased dividends in Q1 2026, showing a slight uptick from the prior quarter, indicating dividend growth remains viable outside high-capex tech sectors
• The S&P/TSX Composite High Dividend Growth Index weights holdings by yield after selecting companies with highest forecasted dividend-yield growth, avoiding the pitfalls of pure yield-weighting or market-cap approaches
• Q2 earnings season begins with JPMorgan Chase, PepsiCo, and Delta Air Lines reporting in early July, alongside key U.S. jobs data on July 2 that will inform Fed policy decisions

Market Summary: Dividend Growth Investment Opportunities in 2026

Key Themes

While tech companies dominate headlines with massive AI-related capital expenditures totaling hundreds of billions, dividend growth opportunities persist in overlooked market sectors. The analysis suggests investors should expand beyond traditional high-capex technology names to find resilient income plays.

Critical Data Points

• 31% of global firms increased dividends in Q1 2026, marginally higher than Q2 2025's 30%
• Brent and WTI crude oil have fallen into the $70s per barrel
• U.S. gas prices declined below $4 per gallon
• May employment added 172,000 payrolls, though some gains attributed to FIFA World Cup 2026 seasonal hiring
• Unemployment rate holding steady in low-to-mid-4% range

Featured Investment Approach

The S&P/TSX Composite High Dividend Growth Index employs a novel methodology using forward-looking dividend growth forecasts rather than backward-looking historical data. The index weights holdings by dividend yield, avoiding the pitfalls of pure market-cap weighting or yield-only strategies.

Sector Focus

Financials and Energy currently represent the largest index allocations, with additional concentration in Consumer Staples, Industrials, and Utilities—sectors demonstrating capital discipline amid uncertain macro conditions.

Upcoming Catalysts

• July 2: June U.S. jobs report
• July 3: PepsiCo (PEP) earnings
• July 4: Delta Air Lines (DAL) earnings
• July 14: JPMorgan Chase (JPM) kicks off Q2 earnings season

These reports will provide insights into non-tech capital allocation trends and inform Federal Reserve policy decisions under Chair Kevin Warsh.