Fitch Solutions: Commodity Woes Send Freeport McMoRan CDS to Six-Year Wides

NEW YORK--()--The prolonged commodities market fallout is weighing on credit default swap (CDS) spreads for Freeport McMoRan, Inc., which are now at their widest level since 2009, according to Fitch Solutions in its latest CDS case study snapshot.

Five-year CDS on Freeport McMoRan widened out 22% over the past week, underperforming the broader North America Basic Materials industry (7% wider). CDS credit protection for Freeport McMoRan is now pricing deeper in below-investment grade (wide of 'B-') territory.

'Souring market sentiment for Freeport McMoRan likely stems from its investment in oil & gas drilling as well as weaker global demand for metal,' said Director Diana Allmendinger.

Fitch Solutions case studies build on data from its CDS Pricing Service and proprietary quantitative models, including CDS Implied Ratings. These credit risk indicators are designed to provide real-time, market-based views of creditworthiness. As such, they can and often do reflect more short term market views on factors such as currencies, seasonal market effects and short-term technical influences. This is in contrast to Fitch Ratings' Issuer Default Ratings (IDRs), which are based on forward-looking fundamental credit analysis over an extended period of time.

Fitch Group is a global leader in financial information services with operations in more than 30 countries. Fitch Group is comprised of: Fitch Ratings, a global leader in credit ratings and research; Fitch Solutions, a leading provider of credit market data, analytical tools and risk services; BMI Research, an independent provider of country risk and industry analysis specializing in emerging and frontier markets; and Fitch Learning, a preeminent training and professional development firm. With dual headquarters in London and New York, Fitch Group is majority owned by Hearst.

Contacts

Fitch Solutions
Diana Allmendinger
Director
+1 212-908-0848
Fitch Solutions, 33 Whitehall Street, New York, NY 10004
or
Media Relations:
Sandro Scenga, New York, +1 212-908-0278
Email: sandro.scenga@fitchratings.com

Contacts

Fitch Solutions
Diana Allmendinger
Director
+1 212-908-0848
Fitch Solutions, 33 Whitehall Street, New York, NY 10004
or
Media Relations:
Sandro Scenga, New York, +1 212-908-0278
Email: sandro.scenga@fitchratings.com