Junk Stocks Rally

Reuters reports:

The junk-stock rally lives on.
The biggest winners since the U.S. stock market got another dose of bull market fever in mid-July have been the companies with the most beaten-down shares and the ones whose business outlooks are seen as the riskiest within the Standard & Poor’s 500 Index.
This winners’ circle has been dominated by 81 S&P companies with unspectacular credit ratings of “BB” or lower, also categorized as high-yield “junk.”
The stock prices of these junk-rated companies have jumped on average by between 21 percent and 29.5 percent between July 10 and Aug. 4.
In comparison, investment-grade companies rated “BBB” or above have seen their shares rise between 9.50 percent and 19.25 percent, according to data from Bespoke Investment Group, a financial research firm based in Harrison, New York.

Posted by on August 7th, 2009 at 10:18 am


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