Over ¼ of Investment Grade Corporates on Negative Watch

via S&P Global Ratings

Per S&P Global, about 1/3 of BBB’s and over ¼ of investment grade corporate credits are on negative credit watch.

Will the ‘other shoe drop’ on some/most of these credits in the second half. Only the pandemic knows for sure.

Key Takeaways:

  • "U.S. corporate downgrades reached a high of 414 in second-quarter 2020 as the sudden-stop U.S. recession deepened."
  • "The pace of downgrades slowed, and the share of issuer credit ratings on CreditWatch with negative implications declined after April as cities and states eased lockdown measures."
  • "Even as we expect the economic recovery to begin in the second half of this year, we anticipate that corporate credit measures will take longer to recover, and all sectors currently show a negative bias that is above their long-term average."

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Over ¼ of Investment Grade Corporates on Negative Watch

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