Moody's in a statement said that it will retain its country outlook at "positive". Senior SBI officials said on condition of anonymity that "all talk of the revised S&P rating affecting our offering targeted at non-resident Indians (NRIs) is misplaced... we have feedback to the extent of nearly $4 billion. And this does not mean that we cannot raise more".

The SBI offering is an open-ended one. The SBI official also ruled out an increase in the interest offered as a result of S&P's revised outlook.A prime reason for the huge positive feedback to SBI's offering is the interest offered. The five-year bond offers 8.5 per cent on dollar deposits, 7.85 on pound sterling and 6.85 on the euro. This is much better than the returns offered in other countries placed in a similar rating profile - be it `Baa1', `Baa2' or `Baa3'.

S&P's revised rating itself came for mild flak from senior corporate and bank treasurers: that is despite the rupee falling to an intra-day low of 46.35/36 on Wednesday, very near its life-time low of 46.41.

Said Credit Analysis & Research's chief economist Mohan Nagraj: "The revision of the outlook is somewhat premature... but I am sure that it will have no adverse effect on the SBI's offering. The economy is growing at a rate of six per cent to 6.5 per cent at this stage. The slowdown is only due to the exogenous shocks, as there are no problems in policy formulation". Sources also pointed out that ``it appeared as if S&P's was waiting for an opportune moment to time its revised rating''.

Says Raymond James banking analyst Hemindra Hazari: "The downturn of the econony has affected the downgradation". The Reserve Bank's forecast of real GDP growth of 6-6.5 per cent for the ongoing fiscal from the April estimates of 6.5-7 per cent, therefore, presented an opportunity to go ahead with the revision for S&P's.

S&P's revised rating outlook on Larsen & Toubro, Reliance Industries and Telco - "stable" from "positive" - is also only a "technical correction" and has little to do with the performance of these companies.

Sensex at 16-month low
Sensex touched its 16-month low of 3,836.5 points as the downgrading of India's rating by Standard & Poor's led bulls to off-load their entire positions.

The fall in Nasdaq on Tuesday night by 115 points also contributed to the bearish sentiments, which brought down the Sensex by 109 points.

Sensex has fallen by 215 points in the last four trading sessions. Satyam Computers and Infosys were the main stocks to pull down on Wednesday.