Standard & Poor's (S&P), the international rating agency, has knocked 15 notches off the credit rating for Railtrack, the UK's rail infrastructure company, relegating the firm to junk bond status.

The depth of S&P's downgrade, which is virtually unprecedented, puts Railtrack into default, according to fund managers holding Railtrack paper. They said the downgrade could trigger forced selling among those funds not able to hold bonds rated below investment grade.