Qantas has been downgraded to junk status just a day after the airline announced the axing of 1000 jobs and and warning it could fall to a $300 million loss in the first half of this year.

The airline had entered a trading halt ahead of the announcement that it lost its investment grade credit rating from Standard & Poor’s, which downgraded the company to a "BB+/B" rating.

The shares opened lower at $1.03 when they resumed trading on Friday afternoon. By 12.59pm, they had fallen 1.4 per cent to $1.055 and closed down 3.74 per cent at $1.03.

Qantas chief financial officer Gareth Evans said the downgrade was “not unexpected” following the airline’s update to the market on Thursday.