Elgin Area Chamber Of Commerce: Russia's Debt Downgraded To Junk, US Billionaire Mulls Buying Chelsea Club, Stocks Rise As Oil Price

Press release from the Elgin Area Chamber of Commerce:

March 10, 2022

Russia’s Debt Downgraded to Junk

Russia’s sovereign debt has been dropped to a junk rating by another credit rating agency with the looming possibility that the country defaults as global economic sanctions squeeze the nation's ability to pay its debts.

Fitch Ratings lowered its rating for Russia’s rating to “C,” a junk rating, with the view that “default is imminent.” This move follows downgrading Russia’s sovereign rating last week.

On Monday, Fitch downgraded debt issued by various Russian banks to just above junk status.

Its moves are among a string of downgrades. Moody’s Investors Service downgraded the country’s debt to junk on Sunday. “The downgrade of Russia's ratings was triggered by Moody's expectation that capital controls by the Central Bank of Russia will restrict cross-border payments including for debt service on government bonds” as well as the “severe concerns around Russia's willingness and ability to pay its debt obligations,” the agency said in a statement.

Moody’s noted that the central bank paid only local holders of debt after barring payments to nonresidents.

S&P Global Ratings also has downgraded the country’s debt over the past week to junk status.

US Billionaire Mulls Buying Chelsea Club

An American billionaire who made his fortune with private equity firm Apollo Global Management reportedly is exploring buying Chelsea F.C., a team in England’s top soccer division, after the Russian oligarch owner said last week that he’s selling the franchise.

The Financial Times reported that Josh Harris, an Apollo co-founder, is considering buying the Premier League team from Roman Abramovich, who bought the team in 2003 and is selling assets even though he hasn’t been wrapped up in economic sanctions.

Harris owns NBA’s Philadelphia 76ers with David Blitzer, a top executive at Blackstone, through their company Harris Blitzer Sports & Entertainment. They also are majority owners of the NHL’s New Jersey Devils.

Todd Boehly, an American investor in real estate, entertainment, technology and insurance businesses, has already made a bid for the team with Swiss billionaire entrepreneur Hansjorg Wyss, according to reports.

Boehly is a part owner in the Major League Baseball’s Los Angeles Dodgers. He made a bid on the team in 2019 but fell short of the $3 billion Abramovich wanted for the team when his British investor visa renewal was in question.

Stocks Rise as Oil Prices Fall

In another wild day of trading, the U.S. stock market closed much higher while oil prices had their worst percentage decline since November 2020 amid concerns about Russia's invasion of Ukraine.

Each of the major indices closed higher on Wednesday to recover from the free fall on Monday. The Nasdaq Composite was up 3%. The Dow Jones Industrial Average rose 2%, and the S&P 500 added 2.57%.

Oil prices that had hit record highs on Tuesday dropped significantly on Wednesday. West Texas Intermediate crude prices fell 12% to $108.70 per barrel. Prices for Brent crude, the global benchmark, fell 13% to $111.1.

The drop in prices came even after President Biden on Tuesday said the U.S. would ban the import of Russian oil. It represents 6% to 7% of foreign oil imports in the United States.

Biden and his administration have been working on other sources of oil, including encouraging U.S. companies to accelerate production.

Source: www.CoStar.com

This press release was produced by the Elgin Area Chamber of Commerce. The views expressed here are the author’s own.