OREANDA-NEWS. December 14, 2015.  The credit outlook for U.S. diversified industrials and capital goods manufacturers in 2016 is stable, according to Fitch Ratings. Most companies in the sector are positioned to cope with the impact of cyclicality and should maintain credit metrics within expected ranges.

The sector outlook is negative, reflecting challenging conditions in a number of end markets including oil and gas, mining, and agriculture that Fitch expects will remain weak through 2016. Demand for heavy duty trucks likely peaked in 2015 and production can be expected to fall in 2016. These concerns are partly offset by steady demand in commercial aerospace and U.S. construction.

Negative risks outweigh positive risks, reflecting a weak global economic environment, currency risk and low commodity prices. Significant cash deployment for share repurchases pressured credit metrics at several companies in 2015 and represents a continuing concern in 2016.

The full '2016 Outlook: U.S. Diversified Industrials and Capital Goods' is available at 'www.fitchratings.com'.