NEW YORK, February 1 (FinanceEnquiry.com) - Standard & Poor’s Rating Services downgraded its outlook on Jefferies Group Inc. and Cantor Fitzgerald L.P. from stable to negative and assigned ‘BBB-‘ratings on GFI Group Inc. with negative implications on CreditWatch. In addition, a ‘BBB’ counterparty rating was affirmed on Jefferies and Cantor Fitzgerald.

In a research note published on January 28, S&P’s Rating Services mentions that brokers engaged in institutional sales and trading and investment banking businesses are expected to face delayed period of low profitability and potential other financial pressures due to present softness in the financial markets. Notably, the confidence sensitivity of firms, such as Jefferies Group and Cantor Fitzgerald, is increased in such conditions.

The move on the ratings reflects the view on these firms and other institutional brokers are expected to witness pressures and lower profitability, resultant of broader issues clouding the securities markets. S&P believes that such conditions may further increase the already elevated confidence sensitivity of leveraged wholesale funded institutions like Jefferies and Canto.