car industry: The sudden entry of a large issuer like Ford F, 0.00% into the high-yield bond market could weigh on prices for junk corporate credit, according to Market Watch. The U.S. carmaker's more than 35 billion of debt would represent around 3% of the high-yield index. But its their less creditworthy counterparts that may need to worry if Ford receives another downgrade by credit rating agencies S&P or Fitch and officially pushes the automaker out of investment-grade bond indexes. If one more credit ratings firm downgrades Ford, it would become the fifth biggest fallen angel, or high-yield issuer once rated as investment-grade. Back then, troubles in the U.S. car industry saw both General Motors and Ford lose their investment-grade status. Analysts point to 2005 as a example of how fallen angels could overwhelm demand as investors struggle to absorb the bonds of the new entrant into the high-yield market.
(news.financializer.com). As
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