Junk Bond ETFs Fall to Lowest Level Since 2009 as Oil Drops

Exchange-traded funds that hold U.S. junk bonds dropped to their lowest levels since 2009 as the global growth fears that clobbered stock markets also raised doubts about whether companies’ would continue to generate as much cash to pay their debt obligations.

Energy companies’ bonds were hit hardest as oil prices fell to $29.73 a barrel, a 12-year low. Risk premiums on bonds in the sector -- a measure of the extra yield that investors demand for holding companies’ credit risk -- widened by 0.12 percentage point for investment grade credit, and 0.58 percentage point for junk bonds.