Hot stock: Noble falls 6% on S&P downgrade to 'junk'

SHARES of Noble Group fell 6 per cent in heavy trading on Friday morning as investors reacted to the cut in its credit rating by Standard and Poor's (S&P).

The stock lost 3.25 Singapore cents to 32.5 Singapore cents within one hour after the market opened as some 80.2 million shares changed hands.

S&P on Thursday reduced Noble to "junk" and placed it on watch for further cuts, following similar moves by Moody's in December last year. The same day, however, Fitch Ratings said it believes Noble's additional liquidity after the sale of its agriculture unit will help it manage increased collateral requirements.

Noble said the change in investment-grade status is not expected to have a material impact on its operations.

It said in a statement on Thursday: "To date, the increased collateral calls have been immaterial and below the previously indicated range of US$100 million-US$200 million. The current low price environment continues to offer opportunities and plays to our strengths as an asset-light supply chain manager."

Noble had ended 2015 as the worst performer on the Straits Times Index, losing almost two-thirds of its value.