August 09, 2012
S&P - A Two-Year European Recession Would Likely Hurt Ratings In Various U.S. Corporate Sectors
"Standard & Poor's Ratings Services believes that under its downside economic scenario for the eurozone and the U.K., negative outlook and rating actions would likely affect a few U.S. industries, including auto suppliers, aircraft leasing, certain media and entertainment subsectors, high-technology hardware, and semiconductors. However, downgrades are likely to be largely limited to one-notch actions for lower-rated non-investment-grade issuers. We expect balance sheet strengthening and growing revenue diversification into higher-growth markets since 2009 to mitigate the impact of Europe's problems for the vast majority of U.S. issuers rated 'BB' and higher in most sectors. Should a deep and prolonged European recession have a material knock-on effect leading to economic and financial difficulties in other major parts of the world economy, however, the negative impact would likely be broader and deeper on U.S. corporate credit quality and ratings."
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