Moody's agency downgrades Nokia bonds to 'junk' status

Nokia's bonds have been demoted to 'junk' status

Nokia, the troubled Finnish mobile phone manufacturer, has had its bonds downgraded to "junk" status by ratings agency Moody's.

The news follows Nokia's announcement on Thursday that it is to cut another 10,000 jobs globally, bringing the total planned job cuts to 40,000.

Nokia also warned that second-quarter losses from its mobile phone business would be larger than expected.

Moody's is the third ratings agency to downgrade Nokia.

It is concerned about the impact of Nokia's additional restructuring charges of about 1bn euros (£811m; $1.3bn) and the slow take-up of its smartphones running Microsoft's Windows Phone operating system.

Last year Nokia decided to abandon its Symbian operating system for smartphones and switch to Windows instead.

Most stockbrokers have cut their share price forecasts for Nokia, whose shares have dropped 55% over the last year.

But despite the downgrade Nokia shares were up 4% in afternoon trading.