3 Dividend Stocks Wall Street is Piling Into Before 2026

"There is an apparent shift in how Wall Street views the stock market, as retail investors are increasingly doubting the AI rally. This is causing investors to pile into dividend stocks like , . The motivation is the general uncertainty about what the next few months may bring. The Federal Reserve is continuing interest rate cuts, and is expected to cut once more in December. And in 2026, the current Fed Chair Jerome Powell is scheduled to depart. Current Trump appointee (as the Director of the White House National Economic Council), Kevin Hassett, is widely expected to be his replacement."

"If this appointment goes through and Hassett becomes the next Fed chair, he's likely to answer calls from Trump to aggressively lower rates. Trump wants these rates lowered by "at least two to three percentage points". No one knows what the implications will be if such aggressive rate cuts go through while inflation remains uncomfortable."

"But what one can conclude is that dividend stocks can get hot because Treasury yields get dragged down by rate cuts. Plus, many dividend stocks are defensive cash cows that can weather a future downturn if the AI rally slows down. It's a win-win, and here are the three dividend stocks the market likes a lot. Johnson & Johnson (JNJ) Johnson & Johnson has generally been a boring name to hold. The only appeal was the defensive nature of the stock. JNJ comes with a modest dividend yield that occasionally keeps up with inflation to sweeten that deal."

Retail skepticism toward an AI-driven rally is prompting investors to shift into dividend stocks for defensive income. The Federal Reserve is continuing interest rate cuts with another cut expected in December, and Chair Jerome Powell is scheduled to depart in 2026. Kevin Hassett, a Trump appointee, is widely anticipated as a potential replacement and could pursue aggressive rate reductions. Large cuts of two to three percentage points could complicate inflation dynamics. Lower Treasury yields would boost dividend stock appeal, and dividend payers often act as cash-flow-rich defensive holdings. Johnson & Johnson exemplifies this trend with rising dividends, strong CARVYKTI sales, and renewed revenue growth expectations.

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