More than half of credit managers are also expecting increased defaults in North America and Asia, an IACPM survey finds.
There were three times as many debt-issuing companies on negative credit watch as on positive at the end of 2015, S&P says.
S&P warns the speculative-grade market will be under pressure from a "near-certain" hike in interest rates.
While respondents to a quarterly survey continue to be concerned about defaults, the outlook for credit spreads is decidedly mixed.
Recoveries by corporate bond investors usually increase after a peak in the default cycle. This time that isn't the case, says Moody's.
While corporate credit spreads are still narrow, credit portfolio managers see defaults rising in the next 12 months, especially in Europe.
