Downgrade! China gets a double dose of caution from Moody's and MSCI

Moody's downgrades sovereign credit rating, MSCI says several issues have to be resolved

For all the verbiage from Chinese officials on the need to rein in leverage and open markets to global investors, the nation’s leadership got a double dose of caution on Wednesday.

Moody’s Investors Service unveiled a surprise downgrade of China’s sovereign credit rating, citing concerns about its continued buildup of debt. Earlier, the head of one of the world’s top stock-index compilers suggested China had more work to do to get its onshore stocks into emerging-market gauges. With a June 20 deadline looming, “there’s still a lot of issues to resolve,” MSCI Chief Executive Officer Henry Fernandez said.

Underlying the