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S&P: YTD corporate defaults outpace 2018 year-end total

The number of global corporate defaults so far in 2019 exceeded the year-end tally in 2018, with the oil and gas sector as the top contributor, S&P Global Ratings said in a report published Oct. 3.

Collaboration software provider Premiere Global Services, Inc., sales and marketing services outsourcing company Acosta Inc. and logistics service provider Syncreon Group Holdings B.V. defaulted this week, bringing the year-to-date tally to 85. The year-end total in 2018 was at a four-year low of 82.

Twenty-six companies defaulted due to distressed exchanges, while 25 did so on missed principal or interest payments.

Oil and gas companies are leading the year-to-date tally with 18 corporate defaults, followed by retail and restaurants with 13.

The consumer products sector is now in the fifth spot with six defaults, up by two from last week. The Syncreon default is the first for a European consumer products company this year, according to the report.

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By country, the U.S. continues to lead with 58 year-to-date defaults, followed by emerging markets with 13 and Europe with 11. Other developed regions reported three defaults.

The 12-month trailing speculative-grade default rate in the U.S. is estimated to rise to 2.8% in September from 2.5% as of August, while the European rate is forecast to increase to 2.1% from 1.8%, said Sudeep Kesh, head of S&P Global Credit Markets Research.