Sept. 3 (Bloomberg) -- New World Resources Plc dropped as Standard & Poor’s said it may downgrade the company’s credit rating, outweighing jumps in prices of coal and metals.
The stock of the biggest Czech producer of coking coal slid 0.2 percent to 88 koruna at the close in Prague. NWR has dropped 35 percent this year, having reached its lowest in three years on Aug. 30.
S&P cut the outlook on NWR’s BB- credit rating to negative from stable on Aug. 31 after the market closed, citing risks of a downgrade in the next 12 months as low coking-coal prices threaten to dent the company’s earnings.
“We consider the news negative,” Bohumil Trampota, a stock analyst at J&T Banka AS in Prague, wrote in a report to clients today. “Coking-coal prices considerably declined and will probably not go up in the nearest period.”
The stock earlier rose as much as 2.6 percent as basic resources companies were among the biggest gainers in Europe after worse-than-expected economic data from China and the euro area boosted speculation that central banks will add to stimulus. Europe’s benchmark coal derivatives rose 0.9 percent to $100.6 a metric ton in the Netherlands, a second day of gains. The next-year contract is down 11 percent this year.
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