High Yield Chemicals: Ratings Changes

Research evidence excerpt

High Yield Chemicals: Ratings Changes

J P M O R G A N North America Credit Research

29 June 2026

High Yield Chemicals

Ratings Changes

• We are downgrading our sector rating on High Yield Chemicals to North America Corporate Credit -

Underweight (from Neutral). The High Yield Chemicals sector delivered Chemicals and Energy (HY)

total return of 4.56% in 1H26 (~261bp outperformance). Chemicals Leveraged Aaron Rosenthal, CFA AC

Loans delivered 4.63% of total return in 1H26 (~315bp outperformance). (1-212) 270-4584

aaron.rosenthal@jpmorgan.com

• We are downgrading the INEOS Quattro (STYRO) term loans to Neutral Elle Boyd

(from Overweight). Our Neutral rating is now consistent across the

(1-212) 270-7283

company’s bonds and term loans. Commodity chemical spot prices are elle.boyd@jpmchase.com

normalizing quickly from peak April levels. Supply is proving more resilient J.P. Morgan Securities LLC

(than previously anticipated) and buyers are reticent to step back into the spot

market given cautious overall sentiment and sufficient existing inventories.

STYRO’s FY26 earnings outlook remains favorable into 3Q, but uncertainty

into 4Q26/ 2027 is increasing. We maintain that the company is in better shape

relative to our initial modeling expectations into FY26 and that management

has delivered well on recent balance sheet and asset sale efforts. STYRO’s

counterparty/related entity risks have diminished relative to 2H25 positioning.

The company is well positioned to address its 2027 refinancing needs, but

focus now shifts back to the 2029 maturity wall. Risks to our rating include:

Europe regulatory risks, commodity price volatility, and access to capital

markets.

• We are upgrading Celanese to Overweight (from Neutral). CE was already