Coronavirus spread: S&P warns 1 in 10 US firms may default on debt

S&P said companies rated B- and below will likely suffer most from financing needs and would face rapid downgrades

A wave of company defaults is likely to sweep the United States and Europe as measures to contain the coronavirus spark a recession, S&P Global Ratings said Friday.

The agency said it believes the global economy will go into reverse under the impact of the coronavirus crisis and that companies will see cash flow whither and financing conditions tighten.

"These factors will likely result in a surge in defaults, with a default rate on nonfinancial corporates in the US that may rise above 10 percent and into the high single digits in Europe over the next 12 months," said S&P.

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