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Covid-led record defaults cloud India's resilient equities, bonds

Firms have defaulted on at least Rs 5,700 cr of domestic bonds this year, while Sensex hit 3-week high amid optimism on US vaccine support

rupee
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Bloomberg
Credit markets are sounding warnings for other asset classes amid India’s unprecedented surge in Covid-19 cases.

Firms have defaulted on at least Rs 5,700 crore ($763 million) of domestic bonds this year, the most on record for a similar period. Traders expect more. They’ve pushed spreads on A rated local corporate bonds over AAA notes to a 17-year high, a grim sign for the small businesses that tend to have those weaker ratings and that form the bedrock of the $2.7 trillion economy.


That all suggests the need for further caution in the equities and government bond

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