Moody's cuts Jones Apparel to junk

Moody's Investors Service said it downgraded Jones Apparel Group, Inc.'s senior unsecured notes to Ba1 (LGD4, 53%) from Baa3. Moody's assigned the issuer Ba1 corporate family and probability-of-default ratings, concluding the review that began in June.

"The ratings downgrade reflects the persistent negative trends in Jones' wholesale and retail businesses and expectations these businesses will remain challenged due to continued pressures in the market for wholesale apparel distributors," Scott Tuhy, vice president and senior analyst, said in a written statement.

The downgrade also considers the sale of Barneys in September, which resulted in the loss of a business with growth opportunities, the agency said.

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