OREANDA-NEWS. U.S. energy and metals/mining recorded its lowest quarterly new issuance in four years, as sustained commodity price weakness and oversupply continue to afflict these two sectors, says Fitch Ratings.

Overall, new issuance slowed in September to $20 billion from $41 billion a year earlier. Third quarter new issuance tallied $38 billion versus $69 billion in 2014. Volume in the first nine months of 2015 is down 35% year over year for energy and metals/mining but up 3% for the rest of the high yield market.

"Capital markets access for many commodity price-challenged companies has been solid for most of 2015, but energy and metals/mining issuance trailed off dramatically in the third quarter, registering $5 billion versus $16 billion in the second quarter," said Eric Rosenthal, Senior Director of Leveraged Finance.

Nearly half of U.S. energy and metals/mining bond issues are bid below 80 cents compared to just 7% a year ago. These two sectors comprise about 22% of the overall high yield bond market.

The trailing 12-month (TTM) high yield default rate stands at 4.8% and 10.3% for the energy and metals/mining sectors, respectively. The former is at its highest rate since 1999. The overall TTM default rate is 2.9%.

The U.S. high yield bond market has seen at least four defaults per month since February, including October, which already has six registering more than $2 billion in volume. More than $4 billion in default volume has been tallied for three consecutive months in the third quarter, levels not seen since 2009.

The full report, "U.S. High Yield Default Insight: 2015 Default Outlook Boosted to 3.5%," is available at www.fitchratings.com.