Published On: Fri, Jun 22nd, 2012

Moody’s cuts 15 major investment banks ratings

The ratings agency Moody’s downgraded 15 of the world’s biggest banks on Thursday, lowering credit ratings by one to three notches to reflect the risk of losses they face.

CNBC summarized the five biggest in America and how their respective stocks fared after the news:

Bank of America [BAC  7.82    -0.32  (-3.93%)   ] , whose long-term debt rating was cut one notch, to BAA2 from BAA1,

Citigroup [C  27.83    -1.03  (-3.57%)   ] , which was cut two notches, to BAA2 from A3,

Goldman Sachs [GS  93.90    -2.65  (-2.74%)   ] , cut by two notches, to A3 from A1,

JPMorgan [JPM  35.51    -0.94  (-2.58%)   ] , cut by two notches, to AA3 from A2

and Morgan Stanley [MS  13.96    -0.24  (-1.69%)   ] , also cut by two notches, to BAA1 from A2.

Tinothy Geithner Secretary Treasury cartoon caricature

Photo/donkeyhotey donkeyhotey.wordpress.com

“The question now is whether stocks can find a foothold or fall further ahead of the weekend?” said David Morrison, an analyst for GFT Markets.

“Investors have had to contend with a full skip-load of bad news this week,” he explained. “Economic data from the U.S., Europe and China has worsened; the debt crisis across Europe continues to deteriorate and the U.S. Federal Reserve held back from expanding its balance sheet through further asset purchases.”

The CNBC reported added that one of the reasons the Moody’s downgrades didn’t affect markets too badly is that it’s not really a shock. The ratings agency flagged in February that it was considering a mass downgrade of the banks. News of the downgrades started leaking out Thursday afternoon, before European and U.S. markets closed.

Treasury Secretary Timothy Geithner Official White House Photo by Pete Souza

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- Writer and Co-Founder of The Global Dispatch, Brandon has been covering news, offering commentary for years, beginning professionally in 2003 on Crazed Fanboy before expanding into other blogs and sites. Appearing on several radio shows, Brandon has hosted Dispatch Radio, written his first novel (The Rise of the Templar) and completed the three years Global University program in Ministerial Studies to be a pastor. To Contact Brandon email [email protected] ATTN: BRANDON

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