20131003-穆迪服务-Leverage_Rising_29页_556kb

Moody's Weekly Market Outlook Summary

Core Content

This document provides a detailed analysis of the current state and outlook of credit and financial markets, focusing on corporate debt trends, credit spreads, and the impact of the US government shutdown. It also includes a preview of upcoming economic reports and forecasts from the US, UK/Europe, and Asia-Pacific regions.

Main Views

Corporate Leverage and Credit Market Trends

• Corporate Debt Growth Outpaces Profits and Cash Flow: US corporate debt, particularly nonfinancial-corporate debt, has grown significantly faster than profits and cash flow. In Q2-2013, nonfinancial-corporate debt rose by 9.5% year-over-year, while profits only increased by 4.4%.
• Debt-to-Profit Ratio Rises: The ratio of corporate debt to profits increased from 700% in Q2-2011 to 735% in Q2-2013, indicating a deteriorating credit quality.
• Internal Funds Are Insufficient to Cover Debt Growth: The internal funds-to-debt ratio fell to 17.9% in Q2-2013, signaling a potential credit cycle downturn. The debt-to-internal funds ratio rose to 559%, compared to its previous cycle low of 490%.
• Net Interest Expense to Internal Funds Ratio: The ratio of net interest expense to internal funds rose to 19.6% in Q2-2013, higher than the 14.8% average during the 2007 period. This suggests limited potential for credit spreads to narrow significantly.
• Corporate Debt Outpaces Cash: The debt-to-cash ratio for nonfinancial corporations reached 501% in Q2-2013, higher than the previous cycle low of 446% and the 2007 level of 421%.

High Yield Bond Market Outlook

• High Yield Bond Spreads: The high yield spread was at 460 bp in Q2-2013 and is expected to narrow to 435 bp by year-end 2013 due to improved profits.
• Credit Spread Outlook: The high yield spread is unlikely to fall below 341 bp, which was the level during the 2007 credit cycle peak, unless profits growth accelerates significantly.

US Government Shutdown and Market Reaction

• Market Reaction: Financial markets have shown relatively subdued reactions to the US government shutdown. However, the looming debt ceiling issue is a more significant concern.
• Debt Ceiling Implications: If the debt ceiling is not resolved, the risk of a government default increases, which could lead to higher credit spreads and market volatility.
• Investor Sentiment: Investors are likely to view any default as a "technical" event with minimal impact, but the uncertainty surrounding the issue is a risk to market stability.

Key Information

Upcoming Economic Reports

• Friday, October 4:

  • Employment Report – September: Forecasted 180,000 nonfarm payrolls and 7.3% unemployment rate.
  • Germany – Producer Price Index – August: Expected to rise by 0.4%.
  • United Kingdom – Halifax Housing Price Index – September: Projected to rise by 6.3%.
  • Russian Federation – Consumer Price Index – September: Forecasted to rise by 0.3%.

• Tuesday, October 8:

  • Trade Balance – August: Expected to show little change, with a forecast of -$39.0 billion.
  • France – Fiscal Balance – August: Projected to narrow to -€78 billion.
  • France – Trade Balance – August: Expected to remain almost flat at -€4.8 billion.
  • Italy – Government Finance – 2013Q2: Forecasted to widen to -€9.2 billion.

• Wednesday, October 9:

  • FOMC Meeting Minutes: Will outline the economic risk factors that delayed the tapering of QE3.
  • United Kingdom – Industrial Production – August: Forecasted to rise by 0.1%.
  • Germany – Industrial Production – August: Expected to fall by 0.2%.
  • OECD – Composite Leading Indicators – August: Projected to rise to 100.8.

• Thursday, October 10:

  • Import Price Index – September: Forecasted to rise by 0.3%.
  • Producer Price Index – September: Expected to rise by 0.2% overall and 0.1% core.
  • Retail Sales – September: Forecasted to rise by 0.2% overall and 0.4% ex auto.
  • France – Industrial Production – August: Projected to rise by 0.5%.
  • Spain – Industrial Production – August: Expected to fall by -0.8%.

Additional Highlights

• Unincorporated Business Debt: Growth has been minimal, averaging 0.2% annually for the current recovery, compared to 10.5% during 2002-2007.
• Moody's Analytics: The report includes insights from various contributors and analysts across different regions, highlighting the importance of global economic indicators and regulatory changes.
• Credit Outlook: The document also links to Moody's Credit Outlook, a sister publication with detailed rating agency analysis and summaries of recent credit market research.

Conclusion

The report underscores a growing concern about corporate leverage and its implications for credit quality. While the current economic recovery has not yet triggered a significant credit cycle downturn, the rising debt-to-profit and debt-to-cash ratios suggest a potential for increased credit spreads. The US government shutdown and looming debt ceiling issue add to the market uncertainty, though investors are currently not reacting strongly. The outlook for European economies is mixed, with some showing signs of recovery while others face challenges. Overall, the document serves as a comprehensive guide for understanding the dynamics of credit and financial markets in the context of broader economic trends.