S&P said in a report that the change of guidance from policymakers on market liquidity and the resulting sagging investor sentiment dampened the U.S. leveraged finance market in June, with a number of transactions pulled–a stark contrast to the first five months of 2013, which were, to a large extent, a continuation of the boom market of the last quarter of 2012.

S&P notes that the ongoing impact will largely depend on whether policymakers support the market environment.

Overall, changing market conditions are likely to have a limited effect on the ratings of leveraged companies in the short term so long as these changes are fairly subdued. Nevertheless, the current dynamics could mark a real turning point in the leveraged finance market if conditions worsen precipitously for an extended period of time.

To read the entire S&P report, click here.