The debt ratings of Cenovus Energy Inc. and Encana Corp. have been reduced to junk status by Moody’s Investors Service.
Journalist Rebecca Penty of Bloomberg News wrote, “Moody’s cut the ratings of senior unsecured notes for both Canadian producers three steps to Ba2, or two levels below investment grade, from Baa2, according to separate statements Thursday. It also reaffirmed the Baa2 rating of Husky Energy Inc., keeping the Canadian producer’s debt investment grade.”
This news could trigger a wave of selling on the stock market as many funds can’t hold high-yield notes.
(Written by: N. Reitmayer; Original information source: Calgary Herald http://calgaryherald.com/business/energy/cenovus-encana-debt-ratings-cut-to-junk-status-by-moodys)