April junk bond defaults are at a two-year high

Defaults for U.S. high-yield bonds have topped $14 billion in April — the largest monthly volume in two years, according to Fitch Ratings — and the month isn’t even half over.

The speculative-grade default rate for the past 12 months is on pace to reach 3.9 percent in April, up from 2.1 percent for the same period a year ago, after Peabody Energy and Energy XXI filed for bankruptcy this week, according to the Fitch report.

The dollar value of defaults is the most since $20.3 billion in April 2014.

This month’s default rate for coal companies is expected to come close to 70 percent, while the oil and gas exploration and production sector is expected to reach 23 percent and metals and mining will climb to almost 20 percent, Fitch wrote.

Bloomberg News

This story was originally published April 14, 2016 at 2:24 PM with the headline "April junk bond defaults are at a two-year high."