Aug 21 - Standard & Poor's investment-grade composite spread tightened by 1 bp (bp) to 202 bps yesterday, and the speculative-grade composite spread widened by 1 bp to 638 bps. By rating, the 'AA' spread tightened by 1 bp to 132 bps, the 'A' spread tightened by 2 bps to 172 bps, and the 'BBB' spread tightened by 1 bp to 249 bps. The 'BB' spread tightened by 1 bp to 432 bps, the 'B' spread remained flat at 669 bps, and the 'CCC' spread widened by 2 bps to 1,070 bps. By industry, financial institutions, banks, industrials, and utilities contracted by 1 bp each to 286 bps, 299 bps, 292 bps, and 211 bps, respectively. Telecommunications contracted by 2 bps to 314 bps. The investment-grade and speculative-grade spreads are both down from their highs reached in October. The investment-grade spread is lower than both its one-year moving average of 214 bps and its five-year moving average of 245 bps. The speculative-grade composite spread is lower than both its one-year moving average of 689 bps and its five-year moving average of 748 bps. We expect continued volatility in the near term, especially in the speculative-grade segment, which could result from both positive and negative factors. On the positive side, we expect U.S. corporate defaults to remain below the long-term average in the short term. On the negative side, an increase in volatility in the financial markets, influenced by weakening economic conditions, could continue to weigh on risky assets. Standard & Poor's, a part of The McGraw-Hill Companies (NYSE:MHP), is the world's foremost provider of credit ratings. With offices in 23 countries, Standard & Poor's is an important part of the world's financial infrastructure and has played a leading role for 150 years in providing investors with information and independent benchmarks for their investment and financial decisions.