The number of companies at risk of having their debt ratings cut reached a high last month due to a “material slowdown” in housing and consumer activity and tightening credit conditions, according to data from Standard & Poor's cited in The Wall Street Journal.
The number of entities at risk of a downgrade last month stood at 738, up 3.5% from April and 19% from May 2007, according to a report released today.
The number of companies at risk of being downgraded was 16% higher than in 2007, the report found.
Companies carrying a B rating, which make up 22% of May’s total, have the greatest potential to be downgraded. Another 64% are rated BB+ or worse.
The United States topped the list of the countries with companies at risk for ratings cuts.
Of the entities at risk last month, two-thirds are based in the United States, while 17% are in Europe.
S&P also warned that consumer-discretionary sectors — including the media and entertainment and consumer products industries — are “poised for deterioration due to substantive shrinkage in credit availability and rising energy prices.”
No comments:
Post a Comment