Dividend stocks lost some sheen over the last couple of years, as higher interest rates lowered the appeal of fat dividend yields. However, with a September rate cut looking like the most likely scenario, high-yielding stocks could be back in action. I believe Enbridge (ENB) and Rio Tinto (RIO) are two dividend stocks yielding almost 7% that investors can buy in August.
To begin with, the probability of a September rate cut has risen over the last month amid the volatility in stock markets and weak economic data – especially the July unemployment number. Almost half of the traders polled by the CME FedWatch Tool now see the Fed cutting rates by 50 basis points at the September meeting, while the odds were a mere 6% a month back.
