Hong Kong, July 31, 2017 — Moody’s Investors Service says that the stable
rating trend for non-financial corporates in Asia Pacific during 2Q 2017
(the three months ended 30 June 2017) will likely continue through 2H
2017 (the six months ending 31 December 2017).
“The stable rating trend for 2H 2017 will be supported by broadly-based
global growth, stronger export demand, and the recovery of commodity
prices,” says Clara Lau, a Moody’s Group Credit Officer.
Moody’s analysis is contained in its just-released report titled “Credit
Strategy & Standards: Rating trend for Asia-Pacific non-financial
corporates to remain broadly stable in 2H,” and is authored by Lau.
Moody’s report points out that the share of ratings with negative
implications for non-financial corporates in Asia (excluding Japan,
Australia and New Zealand) slid to 19% at end-June 2017 from 29% at
As a result, the share of ratings with stable outlooks rose to 74% at
end-2Q 2017, the highest since the 75% seen at end-1Q 2015.
In Moody’s Japanese portfolio for non-financial corporates, the share of
ratings with negative implications dropped to 24% at end-2Q from 29% the
And, in Moody’s Australian portfolio for non-financial corporates, the
share of ratings with negative implications stayed at 12%, which was
notably lower than the peak of 23% at end-2Q 2016.
Moody’s report also explains that the pressure on companies in the metals
& mining industry is easing, as the industry bottomed out. In Moody’s
Asian (excluding Japan, Australia and New Zealand) portfolio, the share
of ratings with negative implications for metals & mining issuers dropped
to around 27% at end-June 2017 from 60% at end-March 2017.
By contrast, companies in the retail segment are under pressure, with
more than 30% of retailers carrying ratings with negative implications.
For the property sector, 23% of developers’ ratings show negative
implications, because national sales are slowing and regulatory measures
During 2Q 2017, the share of negative rating actions (20) — excluding 28
sovereign-driven actions — slightly outpaced the 15 positive rating
actions for Moody’s non-financial corporates in Asia Pacific.