BHP, Rio Showing Bondholders $8 Billion of Love Warms Up Rally
- Debt issued by BHP is on track for its best month since 2009
- Biggest producers still under ratings downgrade pressure
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Bond investors are rewarding BHP Billiton Ltd. and Rio Tinto Group after the humbled mining giants cut dividends by as much as $8 billion to repair finances. Credit assessors aren’t yet convinced.
Dollar-denominated notes issued by BHP returned 4.2 percent in February, the most since 2009, while Rio Tinto’s rose 2.8 percent, its biggest advance since 2012, according to Bank of America Merrill Lynch’s U.S. Metals, Mining & Steel Index. That follows three months of declines as iron ore, the top earner for both companies, in December touched the lowest in daily prices dating back to May 2009.