Moody's Investors Service Inc. and Standard & Poor's Corp. issued warnings Tuesday on their debt ratings for Hitachi Ltd. following the major electronics maker's downgraded fiscal 2001 earnings forecast announced last week.

Moody's lowered its outlook to negative from stable for its A2 rating on Hitachi's senior unsecured long-term debt, while S&P placed its A-plus long-term and A-1-plus short-term credit ratings on the company on credit watch "with negative implications."

The two major credit-rating agencies said their moves reflect concerns over Hitachi's performance amid a prolonged slump in the global electronics market.

On Friday, Hitachi revised downward its earnings forecast for the current fiscal year ending next March and said it now expects a group net loss of 140 billion yen instead of a net profit of 90 billion yen projected earlier.

Moody's said it "will continue to monitor how Hitachi copes with the increasingly hostile market environment," while S&P said it "will resolve the CreditWatch placements after reassessing Hitachi's ability to restore its earnings power through its immediate restructuring measures and its longer term business strategy."

Moody's said its current rating "already incorporates fluctuations in profitability arising from silicon cycles."

"However, Moody's believes that the current downturn in the global electronics market will be deeper and longer than previously expected and this will have a negative impact on Hitachi's profitability," it said.

S&P said the credit watch placements "also reflect heightening concerns that difficult market conditions could hamper the company's ability to improve its overall earnings power over the longer term."

"Such improvement would depend on the company's ability to strengthen its cost structure and competitiveness in strategically important solution services and devise businesses," S&P said.

Moody's also lowered the outlook to negative from stable for Hitachi's subsidiaries -- Hitachi Asia Ltd., Hitachi Finance (UK) PLC, Hitachi America Ltd. and Hitachi International (Holland) B.V.

S&P also placed its A-plus long-term ratings for Hitachi Capital Corp. and related entities on credit watch with negative implications.