Yesterday, Woolworths’ share price was saved by the Reserve Bank’s interest rate cut. By contrast, today’s decision by Standard & Poor’s to downgrade Woolworths credit rating has caused it to fall 7%. Some of this decline is probably a delayed reaction to yesterday’s sales announcement.
Credit rating downgrades do have a real impact because they generally mean a company will pay a higher interest rate on its debt. But they’re rarely worth worrying about unduly.