Though there were signs of life in the markets on Friday, most of the week saw markets in the red as the government shutdown weighed heavily on investors. In economic news, jobless claims were up this week to 308,000, which was still less than the estimate of 314,000. On Friday, investors had one less report to worry about, as the Labor Department did not issue the September jobs report, due to the government shutdown. Yields on US Treasurys dipped slightly in the middle of the week, but jumped higher on Friday, the fourth day of the government shutdown. Below, we go over Moody's one upgrade and numerous downgrades from the past week.

Upgrades

• Catholic Health East, PA: Moody's upgraded this hospital to Aa2 from A2. The Aa2 rating is attributable to CHE Trinity's position as one of the nation's largest multi-state health systems that has expanded into 21 states, with anticipated operating revenues to be just shy of $14 billion in fiscal year (FY) 2014 following the May 1, 2013 consolidation of Trinity Health and CHE.

Downgrades

• Morenci Area School District, MI: Moody's downgraded this school district from A1 to Baa1. The downgrade to the Baa1 rating reflects the district's considerably narrowed General Fund reserves coupled with a continuous trend of enrollment declines that negatively affects the collection of operating revenues. Also incorporated in the rating is the district's modestly-sized tax base, below average socioeconomic indices, and its elevated debt profile with below average principal amortization.
• Merced Community College District, CA: Moody's downgraded this college district to Aa3 from Aa2. The new rating reflects the district's comparatively small tax base relative to other California community college districts (CCDs), below average resident wealth levels, and manageable debt burden with a slow payout rate. The downgrade also incorporates the district's narrow liquidity, as well as recent operating deficits projected to continue into the current fiscal year, despite expectations of diminished revenue pressure.
• Citizens Energy Group, IN: Moody's downgraded this energy group's second lien bonds to A3 from A2, and its first lien bonds to A2 from A1. The downgrades recognize the business model under which CEG enterprises operate. The organizational structure, management and governance of CEG embody constraints and elements that are different from those of the great majority of U.S. Public Finance enterprises. The rating assigned reflects the potential for performance challenges that are not expected for mainline municipal enterprises.
• Puerto Rico Sales Tax Financing Corporation: Moody's downgraded this taxing corporation to A2. The downgrade reflects the persistent and cumulative effects of the weak economy of the Commonwealth of Puerto Rico (GO, Baa3, negative) has significantly constrained growth in sales tax revenues. While the commonwealth took extraordinary measures in the last several months to stabilize its fiscal situation, economic recovery prospects remain weak.
• North Central Area Schools, MI: Moody's downgraded these area schools to A3 from A2. The downgrade to the A3 rating reflects the district's very weak financial position and trend of operational imbalance. The A3 rating also incorporates the district's recent stabilizing student enrollment trend, small tax base with below average socioeconomic indices, and modest debt burden with average principal repayment.
• Chama Valley Independent School District 19, NM: Moody's downgraded this school district to Baa1 from A3. The downgrade to Baa1 reflects the district's extremely narrow General Fund reserves, modestly sized tax base, and below average socioeconomic indices. The rating also incorporates the district's manageable debt burden with rapid payout. The negative outlook reflects the district's reliance on emergency supplemental funding from the state, very limited reserves, and our expectation that the district will be challenged to build reserves in the future.
• City of Riverview, MI: Moody's downgraded this city to A3 from A1. The A2 issuer rating reflects the city's material valuation declines in the city's tax base, which is located south of Detroit (Caa3/rating under review for downgrade); narrow General Fund reserves; stagnant to declining revenue streams; city management's demonstrated willingness to address budgetary concerns through expenditure reductions; and manageable debt profile with no additional borrowing plans.
• Lane County School District 19, OR: Moody's downgraded this school district to A1 from Aa3. The A1 rating reflects the district's further erosion of an already narrow reserve position due to decreases in state funding combined with increasing personnel costs. The rating also takes into account the district sizeable tax base that experienced recent real market value declines and the district's manageable debt burden that is expected to increase in the future.
• Sagemeadow Utility District, TX: Moody's downgraded this utility district to A3 from A2. The A3 rating reflects the district's weakened financial position following draws on reserves in each of the last four years, some declines in the district's modestly-sized tax base, and manageable debt position.
• Village of Lansing, IL: Moody's downgraded this village to A3 from A1. The downgrade reflects the village's extremely narrow General Fund balance, net of a inter-fund receivable from the village's Municipal Airport Fund which is not expected to be collected in the near to medium term.
• Kankakee County and the Kankakee County Public Building Commission, IL: Moody's downgraded the outstanding general obligation debt for this county and commission to Baa1 from A1, and its outstanding GO limited tax debt certificates to Baa2 from A2. The Baa1 rating reflects the county's significant operating shortfalls that are projected to result in a deficit General Fund balance position at the close of fiscal 2013, leaving the county vulnerable to future financial stresses.
• Village of Rosemont, IL: Moody's downgraded this village from A1 to A2. The downgrade of the village's general obligation rating to A2 from A1 is based on ongoing declines in village's tax base valuations, which have led to an over 40% reduction in its valuation since 2008, along with continued General Fund support for a number of economically-sensitive enterprise operations.
• West Branch Rose City Area Schools, MI: Moody's downgraded this area's schools to A2 from Aa3. The downgrade to A2 primarily reflects the district's sizeable General Fund deficit in fiscal year 2012, narrow reserves in preliminary fiscal year 2013 results, increasing dependence on cash flow note proceeds to fund operations, and accelerated trend of declining enrollment.
• Rockford Public Schools, MI: Moody's downgraded these public schools to A1 from Aa3. The A1 primarily reflects the district's narrow reserve position, anticipated operating deficit in fiscal year 2013 and limited budgetary flexibility. The current rating also incorporates the district's above average debt burden, large property tax base near Grand Rapids and exposure to an underfunded cost-sharing pension plan.
• Goodrich Area Schools, MI: Moody's downgraded this school district to A1 from Aa3. The downgrade to A1 reflects the district's weakened financial position following four consecutive operating deficits. The rating also incorporates the district's moderately-sized tax base, above average resident wealth and income levels, elevated debt burden and an above average pension liability.
• City of Monroe, OH: Moody's downgrade this city to A3 from A1. The downgrade to A3 primarily reflects a breach of covenant in fiscal 2012 as the enterprise failed to maintain coverage of at least 1.10 times maximum annual debt service on the outstanding water revenue bonds.