Our credit market research encompasses ratings performance indicators (including upgrades and downgrades, defaults, outlook changes, weakest links, rising stars, and fallen angels) alongside default and issuance forecasts and financing conditions coverage.
Our "Risky Credits" series focuses on corporate issuers rated 'CCC+' and lower. Because many defaults are of companies in those categories, ratings with negative outlooks or on CreditWatch negative are even more important to monitor.
NORTH AMERICAThe past week saw equal numbers of upgrades and downgrades, with the latter coming primarily from just two sectors: media and entertainment, and chemicals, packaging, and environmental services. Downgrades included one fallen angel, chemicals producer OCI N.V., and one new risky credit, gaming group Affinity Interactive.
All but one of the upgrades involved speculative-grade issuers, which were split across five sectors. Those upgrades included two U.S.-based rising stars, transportation group Delta Air Lines Inc., and utility System Energy Resources Inc. (Entergy Corp).
Last week's only default was U.S.-based capital goods issuer Congruex Group LLC, which defaulted as a result of a distressed exchange. Total defaults for the year to Dec.5 now stand at 136.
READ MOREInvestment-grade downgrades rose to 11 in October, surpassing nine in all of the third quarter, driven by U.S. office REITs and actions related to the downgrade of the Israel sovereign.
The speculative-grade outlook is improving. Negative bias for issuers 'B-' and below has fallen in nine of the last 10 months and is down nearly six percentage points compared with this time last year. Weakest links continued to fall in October, although 71% were due to defaults or rating withdrawals.
U.S. defaults reached 11--their highest monthly count since May 2023. S&P Global Ratings Credit Research & Insights expects the U.S. and European trailing-12-month speculative-grade corporate default rates will decline slightly to 3.25% and 4.25%, respectively, by September 2025.
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