Wharf Holdings' fortunes were buffeted further yesterday when United States agency Standard & Poor's cut the company's debt rating to reflect weakening cash flow.
The agency cut Wharf's long-term rating from A minus to BBB plus, took the company off CreditWatch, and left its ratings outlook as negative.
S&P said the rating change reflected slower than expected progress in Wharf's loss-making communications businesses, and declines in the Hong Kong property market.
The agency said the 'deterioration in the operating environment and the general economic slowdown have impacted on Wharf's historically conservative financial profile'.
Wharf shares slumped as much as 4.5 per cent in early trading as investors responded to the rating cut with a selling spree.
The stock later recovered some of its losses but still ended the day 2.7 per cent down at $10.70, even as the Hang Seng Index ended the day with slight gains.
Analysts said the rating cut had been expected as the market had already been pricing in the effect of the property slide on Wharf's balance sheet and gearing levels.