Following a period of instability earlier this month, the major stock market averages ended higher last week, marking three weeks of gains. The S&P 500 closed at a record high yesterday, with corporate earnings impressing investors. Therefore, we think S&P 500 stocks AT&T (T) and Altria (MO), which pay dividends that yield more than 7%, could be solid additions to one’s portfolio. Read on.October started with a highly volatile stock market due to uncertainties around potential monetary policy changes and supply chain constraints. However, the major stock indexes performed well later, with a solid start to the third-quarter earnings season, a decline in initial jobless claims, and declining COVID-19 cases.
The Dow Jones Industrial Average and S&P 500 closed at record highs on Monday. According to FactSet, of the 23% S&P 500 companies that had reported earnings as of October 22, 84% have exceeded consensus EPS estimates, which is above the 76% five-year average.
However, given the supply chain disruptions and rising inflation, the market may witness further volatility. Therefore, since dividend-paying stocks can reduce overall portfolio risk and volatility, we think they could be ideal bets now. Considering the S&P 500’s solid performance and expected market volatility in the near term, it could be wise to add S&P 500 members AT&T Inc. (T) and Altria Group , Inc. (NYSE:MO) to one’s portfolio. The dividends paid by these stocks yield more than 7%.