Stock Market Today: A Little Trade Sunshine Helps Stocks Grow

Stocks put up a mixed performance Tuesday as investors weighed encouraging news on the trade front with discouraging consumer data.

Top U.S. and Chinese trade officials, in their first formal dialogue in more than three months, reaffirmed their commitment to their "Phase 1" trade deal. That helped calm investor anxieties following several recent political provocations.

Also Tuesday, housing market stocks received yet another parcel of good news as the Commerce Departed reported a 13.9% rise in new single-family home sales during July to a seasonally adjusted annual rate of 901,000 units.

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"The reading was above the Reuters consensus forecast of 785,000 and the strongest since December 2006," notes Argus Research.

However, the Conference Board's consumer confidence index plunged from a revised 91.7 in July to 84.8 in August, a six-year low.

"Amid a resurgence in COVID-19 cases over the summer, states have had to partially reverse or delay reopening measures, which have likely weighed on households' income and employment prospects," writes Pooja Sriram, Vice President, US Economist at Barclays Investment Bank. "In addition, in the absence of additional fiscal stimulus measures, some government assistance programs to households and businesses have been pared down, while others are due to expire soon, making business and income prospects less favorable.

The Dow Jones Industrial Average declined 0.2% to 28,248. Three of the biggest weights on the index – Exxon Mobil (XOM (opens in new tab), -3.1%), Pfizer (PFE (opens in new tab), -1.1%) and Raytheon Technologies (RTX (opens in new tab), -1.5%) – had special reason to slide today. S&P Dow Jones Indices last night announced that those three stocks will be booted from the Dow Jones Industrial Average next week.

The Nasdaq Composite (+0.8% to 11,466) and S&P 500 (+0.4% to 3,443), meanwhile, both pressed further into record territory thanks to gains from Facebook (FB (opens in new tab), +3.5%) and Amazon.com (AMZN (opens in new tab), +1.2%), among others. The small-cap Russell 2000 edged 0.2% higher to 1,571.

Where's the (Safe) Cash?

While the broad market continues plumping up, its yield continues to be pinched. The S&P 500 now yields a measly 1.7% – not just because of rising stock prices, but because some companies have been slow to raise their payouts, while others have been forced to cut or suspend their dividends.

Thus, while yield matters, it's vital to evaluate income positions for their safety, too.

Investors sometimes are content with a long-enough track record of dividend growth, like what you'll find among the Dividend Aristocrats, all of which have improved their payouts for a minimum of 25 straight years. So far in 2020, just one (former) component of the 60-plus-member group has announced a negative dividend action.

But it's also worth looking under the hood to get an idea of their ability to keep writing dividend checks.

These 10 dividend stocks have extremely conservative payout management, paying out a small percentage of their profits as dividends. That, as well as notable dividend growth over the past decade or so, are reasons to trust that they will continue to dole out cash regularly going forward.