WARSAW (Thomson Financial) - Standard and Poor's Ratings said today it cut its outlook on Hungary's sovereign debt ratings to negative from stable, citing worsening prospects for public finance consolidation from next year.

The former communist EU member has taken steps to cut its runaway budget deficit, but analysts fear the government will lack the discipline to meet the EU's cap of 3 pct of GDP ahead of elections in 2010.

"The increasing political incentives and pressure to dilute the fiscal reforms ahead of upcoming elections, coupled with the increasing cost of external borrowing, will interrupt Hungary's progress in reducing its deficit from 2009 and will keep the debt burden rising," Standard & Poor's credit analyst Frank Gill said in a statement.

patrick.graham@thomson.com *48 22 447 2430 pjg/ejp COPYRIGHT Copyright Thomson Financial News Limited 2007.

Citizens Bash Corzine's State Budget Plan

With residents outraged over skyrocketing property taxes, rising tuition and reduced help for the poor and mentally ill, Gov. Jon S. Corzine's proposed budget took it on the chin Wednesday at its first public hearing. Corzine's $33 billion budget proposal, with its $2.7 billion in proposed spending cuts, drew poor reviews from residents and officials at the first legislative hearing on the plan, held Wednesday at Rutgers University in New Brunswick. Even Corzine's fellow Democrats criticized the governor's cost-cutting plan, attacking the wisdom of eliminating state aid for small towns. "I find it indefensible that towns are having their funding smashed way based on population," said Senate Budget Chairwoman Barbara Buono, D-Middlesex. Sen. Paul Sarlo, D-Bergen, vowed to fight Corzine's proposed 10.5 percent cut in municipal aid.

(AFX UK Focus) 2008-03-26 05:33 GMT: Hong Kong shares end morning higher on strong mainland company earnings - UPDATE

HONG KONG (Thomson Financial) - Hong Kong shares finished Wednesday morning higher, extending the previous session's 6.4 percent rally, with financial stocks boosted by stronger-than-expected earnings reported by mainland Chinese companies.

"Buying interest is there partly because the results are encouraging. Investors are less pessimistic about the companies' prospects this year," said Conita Hung, research head at Delta Asia Securities.

The Hang Seng index was up 156.42 points or 0.7 percent at 22,620.94.

Turnover was 54.8 billion Hong Kong dollars.

Blue chips China Mobile Ltd and HSBC Holdings rose after fund managers adjusted their portfolios ahead of the end of the quarter.

"Some quarter-end window-dressing also helped support certain stocks," said Hung.