By Alistair MacDonald 
 

Fitch Ratings downgraded steelmaker ArcelorMittal to junk rating, or to BB+ from BBB- on Wednesday.

The ratings company said the economic fallout from coronavirus will last through most of 2021, bringing pressure on steel consuming industries, such as automotive and construction.

Steelmakers' share prices have been hammered by such concerns. ArcelorMittal is down 41% so far this year, while Thyssenkrupp AG is down 55% and United States Steel Corp is down 43%.

ArcelorMittal has idled steel plants around the world. Fitch noted that the company has a history of taking decisive action to manage crises and pointed out that its $10.4 billion of cash and credit lines against short-term debt of $2.6 billion means that it is actually "well placed to cope with the pandemic."

Moody's Investors Service and S&P Global Ratings still rank the steel maker as investment grade--but in lowest rating of that bracket.

 

Write to Alistair MacDonald at alistair.macdonald@wsj.com

 

(END) Dow Jones Newswires

April 08, 2020 09:22 ET (13:22 GMT)

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