Qantas suffers biggest single-day rout as slashes announced Qantas chief Alan Joyce. Picture: AFP / Greg Wood Source: AFP QANTAS has suffered its biggest single-day market rout in 18 months as the pall over the flag carrier dramatically itensifies. And the airline's shares have plunged to their lowest level in more than a year amid fears it will be stripped of its investment-grade credit rating as it tumbles back into the red. The Flying Kangaroo's shares plummeted 11 per cent yesterday, wiping almost $300 million from its market value as chief Alan Joyce delivered a bleak trading update. After falling below $1 in early trading, the share price recovered slightly to close at $1.07 - its lowest level since July last year. Late yesterday, global ratings agency Moody's put Qantas on review for a downgrade following Mr Joyce's revelation the airline would suffer a deep first-half loss and was poised to sack 1000 workers. Moody's currently rates the carrier's debt at Baa3. If it downgrades Qantas by even one notch, the airline will have a non-investment grade credit rating - known in the finance industry as "junk." Mr Joyce has been furiously trying to secure a support package from Canberra so the airline can keep its investment-grade rating. The Moody's warning came after Qantas declared that it expected to post an underlying loss before tax of $250 million to $300 million for the six months to December 31. Qantas said trading conditions deteriorated markedly in November with a decline in passenger numbers and profitability. Analysts at Bank of America Merrill Lynch now expect the airline to make a pre-tax underlying loss of $868 million for the year to June. Qantas posted a wafer-thin net profit of $6 million last financial year. The previous year, it had reported its first full-year net loss - at $244 million - since it was privatised in the 1990s. Merrill Lynch analyst Matthew Spence said the airline was now likely to be downgraded. Assets sales could alleviate some pressure but are unlikely in the near term. We believe the only option appears to be Federal Government intervention," he said in a note to investors. The cost of Qantas' debt would likely increase on refinancing, he said. Moody's vice president Arnon Musiker said the agency's review reflected "the material downward pressure on Qantas's credit metrics" He also noted that the government could move to prop up the airlines bottom line. "Whilst the issue is currently a matter of discussion and the government has not detailed how it plans to proceed, a form of government support would also provide support for Qantas' credit profile," Mr Musiker said. Revealing the extent of the airlines woes yesterday, Mr Joyce said the circumstances demanded urgent action. "We will do whatever we need to do to secure the Qantas Group's future," he said.