ADR Report-ADRs slip after Moody's cuts Portugal to junk
NEW YORK, July 5
NEW YORK, July 5 (Reuters) - U.S.-listed shares of overseas companies traded lower on Tuesday after Moody's Investors Service downgraded Portugal's debt to junk, sparking fresh concerns about the financial stability of the euro zone.
European bank shares trading in the United States fell sharply, with Lloyds Banking Group (LYG.N) shares down 6.3 percent, Deutsche Bank (DB.N) shares sliding 2.7 percent, and Barclays (BCS.N) shares falling 2.2 percent.
The BNY Mellon index of leading American Depositary Receipts (ADRs) .BKADR fell 0.5 percent while the U.S. benchmark S&P 500 index .SPX was down 0.1 percent.
Moody's rating agency on Tuesday cut Portugal's credit rating by four levels to Ba2, putting it in junk territory, spurred by increased concerns over the country's ability to meet its deficit reduction and debt stabilization targets set out in its loan agreement with the European Union and International Monetary Fund.
The move renewed worries of a European sovereign-debt crisis not long after Greece passed a key vote on its own austerity measures, tempering concerns last week. The BNY Mellon index of leading European ADRs .BKEUR was down 0.8 percent. U.S.-listed shares of Portugal Telecom (PT.N) were down 1.6 percent. In Europe, the FTSEurofirst 300 .FTEU3 index of top shares ended up 0.1 percent.
Portugal's debt downgrade also pressured shares of Chinese companies trading in the United States. The BNY Mellon index of leading Asian ADRs .BKAS swung into negative territory after the rate cut, with the index down 0.1 percent.
Shares of China Finance Online Co Ltd (JRJC.O) fell 3.8 percent. In Asia, shares ended mostly higher, with Chinese shares reaching a six-week high on Tuesday after a late rally in utilities and coal-related stocks boosted the broader market.
Receipts with the BNY Mellon index of leading Latin American ADRs .BKLA were also down, 0.7 percent. Bancolombia (CIB.N) shares trading in the United States fell 0.8 percent. In Latin America, equities fell across the board on Tuesday after steady gains left stocks vulnerable to profit taking. (Editing by James Dalgleish)