Global share buybacks return with a bang as stocks hit records

US companies have announced $105bn (€97.4bn) in planned share repurchases in the first seven days of February, surpassing the full-month tally in January

S&P 500 firms are expected to repurchase $885bn (€821bn) in stock this year, up 10% from 2023 but down 4% from the record-setting pace in 2022, according to preliminary data from S&P Dow Jones Indices. (Photo by Spencer Platt/Getty Images)

Stronger than expected earnings are leading companies on both sides of the Atlantic to announce share buybacks at a blistering pace as 2024 gets going — a potentially crucial pillar of support for global stock markets already trading at all-time highs.

Facing the highest borrowing costs in decades, corporations turned stingy on share repurchases in 2023, but that’s changing with buybacks projected to increase this year. Profit growth is improving and investors expect the Federal Reserve and European Central Bank to start cutting interest rates this year. The reduced borrowing costs should give companies more cash and room to take on debt to boost their share prices.