Woodford - dividends could grow 10% this year

Invesco Perpetual's Neil Woodford believes dividends of the stocks in his portfolios could grow by up to 10% this year.

Woodford says his IP High Income and Income funds are currently yielding about 4.2% - more than 20% over the current market level - and he expects this to grow going forward. "The yields available on the funds at this point in time are very attractive at the moment," Woodford says. "For many of the stocks in my portfolio, the dividend yield is above their respective corporate bond yield." Woodford has warned cyclical stocks will not deliver in 2010, believing corporate earnings expectations are "too optimistic". "I do not think we have the ingredients for suitable market recover...