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Bloomberg Quint
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US Stocks Fall Late On US Downgrade as Yields Climb: Markets Wrap
- Moody’s downgraded the US credit rating which led to late stock falls and bond yield increases.
- The SPDR S&P 500 ETF Trust dropped about 1% post Moody's downgrade, marking a third consecutive week of losses.
- Long-term Treasury yields are rising towards 5% due to concerns over the tax-cut plan and surging debt load in the US.
- US deficit exceeding 6% of GDP for the past two years raises concerns about debt sustainability.
- JPMorgan Chase CEO warned about risks of inflation and higher long-term rates due to US deficit and debt load.
- Moody’s downgrade highlights the need for action to address the growing national debt quickly.
- US-China trade truce optimism boosted equities before the downgrade, with concerns about decelerating revenue growth now tempering market upside.
- US equities rally is expected to slow down due to concerns around revenue growth and earnings momentum.
- Despite better-than-expected earnings results, uncertain global economic outlook impacts profit guidance momentum negatively.
- Key corporate events included Boeing's 737 Max deal, Nvidia's stake in CoreWeave, and Charter Communications' agreement with Cox Communications.
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