The low prices are spreading through metal, mining and energy sector like a virus. The number of junk bonds in the United States economy is all time high since the financial collapse of 2009. The most dangerous companies have largest debt amount, according to latest data.
Magnetation LLC, the iron processing company and Patriot Coal Corporation are among nine loan defaulters company in May, the data released by Fitch Rating, a financial firm pointed out. The mining companies are also in the least along with metal and energy firm. This is very risky condition for the economy. The second quarter debt data also revealed that these two industries have 93 percent default debt. Magnetation LLC, an iron processing company and Patriot Coal Corporation are among nine firms which were declared as defaulters as per the Fitch Ratings. Fitch is a financial services company.
The data points out that around 93 percent of the debt defaulters expected in the second quarter are from metal or mining. Last year, the Bloomberg commodity index which enlists 22 raw materials went down by whooping 25 percent. The oil prices played crucial role here as the industry saw lowest per barrel rates in the history of the industry. Senior Director Eric Rosenthal maintained that the basic indicators of the mining, metal and energy sector look good but oil industry has suffered in rate due to too much production. The number of defaulters will increase if oil rates continue to remain this low by the end of current fiscal.