Rental car sector affected by the economy?: You can see that the U.S. car market has slumped by just reading about the loss of the big automakers in March, but that’s not all. The rental car sector does also show weakening, as bonds from some of the largest companies in the market slid off the back of declining used car prices and falling sales.
The premiums investors demand to hold bonds issued by Hertz and Avis Budget Group have surged amid the market souring on the industry, jolted further on Monday after the pace of auto sales fell 10 per cent since December. Bonds issued by the two companies were the three biggest high-yield losers on Tuesday, with some maturities suffering further losses on Wednesday. Of the 10 worst-performing US junk bonds on Tuesday, eight were related to the auto industry. Bonds issued by the two companies were the three biggest high-yield losers on Tuesday, with some maturities suffering further losses on Wednesday.
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