Fresh credit fears as S&P cuts US bank ratings

clock

Shares in US investment banks fell sharply yesterday as a number of Standard & Poor's (S&P) credit downgrades sparked fears of fresh write-downs and further losses in second quarter trading.

S&P lowered ratings for Morgan Stanley, Merrill Lynch and Lehman Brothers, citing a negative outlook for all three banking giants. Lehman Brothers took the hardest hit, its share price fell 8.1% after S&P downgraded its long-term rating from A+ to A. S&P says the effects of March’s difficult operating environment will only be reflected in Lehman's Q2. “We expect a relatively meaningful deterioration in Lehman's second-quarter performance owing to a generally slower business environment, additional write-downs on certain troubled exposures, and the negative effects of hedges due to bas...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Investment

Why markets keep rising despite a more uncertain world

Why markets keep rising despite a more uncertain world

'For investors, maintaining diversification and portfolio resilience remains essential'

Fahad Hassan
clock 02 June 2026 • 4 min read
Technology and emerging markets top performing sectors in May

Technology and emerging markets top performing sectors in May

FE Analytics data shows

clock 01 June 2026 • 1 min read
Rathbones brings together responsible investment in Centre of Excellence

Rathbones brings together responsible investment in Centre of Excellence

Combines ethical and sustainable research capabilities

Patrick Brusnahan
clock 29 May 2026 • 1 min read