Troy's Lyon: Further dividend cuts would pose 'serious challenge' to UK market

Threat to market support

The number of companies being forced to cut dividends could have serious consequences for the UK equity market, according to Troy Asset Management's Sebastian Lyon.

The manager (pictured) of the £2.4bn Trojan fund has described dividend yields as "one prop supporting the UK equity market" in the face of dismal earnings. However, with many stalwarts of the UK market facing the prospect of cutting their dividends, there is a serious threat to this support that echoes the run-up to the two other major crises in the market's history. What risk does the commodity slump pose to income investors Referencing the dot-com bust and the financial crisis, Lyon said: "History rarely repeats itself, but the number of large UK companies being forced to cut th...