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☆ Here’s what the downgrade of U.S. credit rating by Fitch means for the market
▼ + stars: | 2023-08-02 | by ( ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailHere’s what the downgrade of U.S. credit rating by Fitch means for the marketDavid Zervos, chief market strategist at Jefferies, joins 'Squawk on the Street' to discuss Fitch downgrading U.S. long-term rating to AA+ from AAA and what this means for the market.

Persons: Fitch, David Zervos Organizations: Jefferies, AAA

☆ US Treasury yields edge lower after Fitch downgrade
▼ + stars: | 2023-08-02 | by ( Kevin Buckland | ) www.reuters.com time to read: +1 min

REUTERS/Dado Ruvic/IllustrationTOKYO, Aug 2 (Reuters) - U.S. Treasury yields edged down in Tokyo on Wednesday after ratings agency Fitch lowered the country's top credit rating. The 10-year Treasury note declined about 3.2 basis points (bps) to 4.015% as of 0017 GMT, retracing part of its 9 bps rise from Tuesday. Fitch overnight downgraded the U.S. government's rating to AA+ from AAA, citing an expected fiscal deterioration over the next three years as well as a high and growing general government debt burden. It had placed the rating on watch for a possible cut in May. "This will likely spark risk aversion flows as Asian markets re-open," Tony Sycamore, a markets analyst at IG, wrote in a note to clients.

Persons: Dado Ruvic, Fitch, Tony Sycamore, Joe Biden, Kevin Buckland, Jacqueline Wong Organizations: REUTERS, Treasury, AAA, IG, Swiss, Democratic, Republican, Standard, AA, Thomson Locations: Tokyo

☆ Watch CNBC's full interview with Fitch Ratings' Richard Francis
▼ + stars: | 2023-08-02 | by ( ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailWatch CNBC's full interview with Fitch Ratings' Richard FrancisRichard Francis, co-head of the Americas Sovereign Ratings at Fitch Ratings, joins ‘Squawk on the Street’ to discuss why his firm downgraded the United States’ long-term foreign currency issuer default rating to AA+ from AAA, the possibility of mild recession in the near future, and more.

Persons: Richard Francis Richard Francis, Squawk Organizations: Fitch, United, AAA Locations: Americas, United States

☆ Factbox: Credit rating: The shrinking 'triple A' club
▼ + stars: | 2023-08-02 | by ( ) www.reuters.com time to read: 1 min

Aug 2 (Reuters) - Ratings agency Fitch on Tuesday downgraded the U.S. government's top credit rating by a notch to 'AA+' sending jitters across global markets as investors assessed the impact from the move. Here is a list of countries whose sovereign debt is still rated 'AAA' by at least two of the top three ratings agencies:Compiled by Susan Mathew, Shubham Kalia, and Shubham Batra in Bengaluru;Our Standards: The Thomson Reuters Trust Principles.

Persons: Fitch, Susan Mathew, Shubham Kalia, Shubham Batra Organizations: AAA, Thomson Locations: Bengaluru

☆ Fitch 'vying for credibility' with U.S. rating downgrade, says Moneta CIO Aoifinn Devitt
▼ + stars: | 2023-08-02 | by ( ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailFitch 'vying for credibility' with U.S. rating downgrade, says Moneta CIO Aoifinn DevittAoifinn Devitt, Moneta CIO, joins 'Squawk Box' to discuss Fitch Ratings downgrading the U.S. government's credit carting to AA+ from AAA, citing what it sees as 'fiscal deterioration' over the next three years and continued 11th hour deals to raise the debt limit, the impact of the downgrade on markets, and more.

Persons: Fitch, Aoifinn Devitt Aoifinn Devitt, carting Organizations: U.S, Moneta, Fitch, AAA

☆ 'A short-term glitch:' Wall Street pros shrug off the effect of Fitch's downgrade on markets
▼ + stars: | 2023-08-02 | by ( Sarah Min | ) www.cnbc.com time to read: +3 min

The Dow Jones Industrial Average fell more than 200 points Wednesday after the downgrade as traders weighed the move. US10Y 1Y mountain 10-year yield 1-year However, Wall Street strategists mostly took the downgrade in stride. The S & P 500's 17% rally this year and the Nasdaq Composite's 33% advance had some traders worrying that equities have surged "too far, too fast." Stovall's S & P 500 year-end target is at 4,575 . Goldman Sachs' Jan Hatzius said Tuesday the downgrade will have "little direct impact" on financial markets.

Persons: Fitch, Janet Yellen, Sam Stovall, Stovall's, Wells Fargo's Christopher Harvey, Goldman Sachs, Jan Hatzius, Steven Zeng, Management's Yung, Yu Ma, Ma, CFRA's Stovall, Deutsche Bank's Zeng, Michael Bloom Organizations: U.S ., Fitch, AAA, Dow Jones, Treasury, Street, Nasdaq, Deutsche, BMO Locations: Washington, U.S, Tuesday's

☆ Asian markets tumble as Fitch downgrades US debt rating
▼ + stars: | 2023-08-02 | by ( Laura He | ) edition.cnn.com time to read: +2 min

Asian markets may “tread cautiously” as investors turn wary of foreign holders selling their US Treasuries, said Stephen Innes, managing partner of SPI Asset Management. Just hours before, Fitch Ratings had cut the credit rating of US debt from the top AAA level to AA+. Together they own $2 trillion, which is more than a quarter of the $7.6 trillion in US Treasury securities held by foreign countries. Nonetheless, Goldman Sachs analysts said on Wednesday that they don’t believe there are any meaningful holders of Treasury securities who will be forced to sell due to a downgrade. “Because Treasury securities are such an important asset class, most investment mandates and regulatory regimes refer to them specifically, rather than AAA-rated government debt,” the Goldman Sachs analysts said.

Persons: Fitch, “, Australia’s, Stephen Innes, Goldman Sachs, ” Organizations: Hong Kong CNN, Nikkei, . Tech, China’s, Fitch, AAA, AA, Treasury Locations: Hong Kong, China’s Shanghai, United States, China, Japan

Passersby are reflected on an electric stock quotation board outside a brokerage in Tokyo, Japan April 18, 2023. REUTERS/Issei Kato/File PhotoAug 3 (Reuters) - A look at the day ahead in Asian markets from Jamie McGeever, financial markets columnist. Services PMI data from Australia, Japan, India and China are due on Thursday, with China's unofficial Caixin report coming under the closest scrutiny. The U.S. yield curve has been steepening for more than a week, led by selling at the long end. The yen ended the day little changed, and dollar/yen volatility is comfortably lower than it was before Friday's BOJ move.

Persons: Issei Kato, Jamie McGeever, Friday's, Marguerita Choy Organizations: REUTERS, AAA, PMI, Nasdaq, Treasury, Bank of, Thomson, Reuters Locations: Tokyo, Japan, Asia, Australia, India, China, U.S

☆ JPMorgan CEO Jamie Dimon calls Fitch Ratings U.S. downgrade 'ridiculous,' but says 'doesn't really matter'
▼ + stars: | 2023-08-02 | by ( Hugh Son | ) www.cnbc.com time to read: +1 min

The Fitch Ratings downgrade of the United States' long-term credit rating ultimately doesn't matter, JPMorgan Chase CEO Jamie Dimon told CNBC on Wednesday. "It doesn't really matter that much" because it is the market, and not rating agencies, that determine borrowing costs, Dimon told CNBC's Leslie Picker. Still, it is "ridiculous" that countries including Canada have higher credit ratings than the U.S. when they depend on the stability created by the U.S. and its military, Dimon added. "To have them be triple-A and not America is kind of ridiculous," Dimon said. "We should get rid of the debt ceiling," Dimon said.

Persons: Jamie Dimon, Dimon, CNBC's Leslie Picker, It's, Fitch Organizations: Fitch, JPMorgan, CNBC, U.S, AAA Locations: United States, Canada, U.S, America

☆ Asia markets poised to fall as Fitch lowers U.S. credit ratings
▼ + stars: | 2023-08-02 | by ( Lim Hui Jie | ) www.cnbc.com time to read: +1 min

Shoppers at the shopping street in Hongdae district in Seoul, South Korea, on Saturday, July 2, 2022. Asia-Pacific markets are set to largely fall Wednesday after ratings agency Fitch cut the U.S. credit rating from AAA to AA+, citing "expected fiscal deterioration over the next three years." Futures for Australia's S&P/ASX 200 point to a lower open, standing at 7,360 compared to its last close of 7,450. Japan's Nikkei 225 is also set to fall, with the futures contract in Chicago at 33,145 and its counterpart in Osaka at 33,190 against the index's last close of 33,476.58. Hong Kong's Hang Seng index futures stood at 19,892, pointing to a weaker open compared to compared to the HSI's close of 20,011.12.

Persons: Fitch, Tony Sycamore Organizations: AAA, AA, Swiss, New, Australia's, Nikkei Locations: Hongdae, Seoul, South Korea, Asia, Pacific, treasuries, New Zealand, Korea, Chicago, Osaka

It’s unlikely that the move — only the second downgrade in American history — will dent investor appetite for Treasury notes. But the decision is another sign that Wall Street is worried about political chaos, including brinkmanship over the debt limit that is becoming entrenched in Washington. The move came two months after Washington narrowly avoided a U.S. default, following a prolonged argument over the debt ceiling. (That said, some on Wall Street remain skeptical that the country is headed for a so-called soft landing.) Fitch’s own model shows the U.S. economy deteriorating during the Trump administration and recovering under President Biden.

Persons: Fitch, “, Trump, Biden Organizations: Fitch, United States ’ AAA, Washington, Social Security Locations: U.S, Washington

That deterioration, as well as increased polarization in the country’s political climate, was visible in the Jan. 6 insurrection, which the agency highlighted in meetings with the Treasury ahead of the downgrade. "You have the debt ceiling, you have Jan. 6. Higher interest rates are also likely to make the country's debt burden heavier to sustain, he added. The latest debt ceiling suspension, agreed in June, will last until early 2025, when another political debate around the borrowing limit is likely, he added. "That would just highlight the real political polarization and the kind of deterioration in governance that we've already noted ... to have a two-notch downgrade would be pretty harsh."

Persons: Donald Trump, Leah Millis, Fitch, Richard Francis, Francis, Janet Yellen, we've, Davide Barbuscia, Megan Davies, Ira Iosebashvili, Andrea Ricci Organizations: U.S, Capitol, REUTERS, Fitch, Reuters, AAA, Republicans, Hearst, Standard, Treasury, Thomson Locations: Washington , U.S, States, United States

☆ U.S. markets may not see lasting impact from Fitch downgrade
▼ + stars: | 2023-08-02 | by ( Susan Mathew | ) www.reuters.com time to read: +3 min

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., July 26, 2023. Early moves in U.S. financial markets on Wednesday indicated some aversion to riskier assets as investors assessed the impact of the surprise downgrade. The dollar climbed 0.2%, after slipping broadly in the wake of the downgrade. "Investors have lived through the S&P downgrade in 2011 and remember coming away unscathed. "We see the market impact from the downgrade news as ultimately limited, and Friday's jobs report could trump the downgrade news as monetary policy is still the dominant driver for yields."

Persons: Brendan McDermid, Steven Zeng, Jay Barry, Data, J.P.Morgan, Fitch, Goldman Sachs, Jan Hatzius, Moody's, Susan Mathew, Saumyadeb Organizations: New York Stock Exchange, REUTERS, P Global, Nasdaq, Treasury, Fitch, Deutsche Bank, Federal Reserve, Gross, AAA, Aaa, U.S ., U.S, Thomson Locations: New York City, U.S, Bengaluru

☆ UK's FTSE 100 opens lower after surprise U.S. credit rating cut sours mood
▼ + stars: | 2023-08-02 | by ( ) www.reuters.com time to read: +1 min

The London Stock Exchange Group offices are seen in the City of London, Britain, December 29, 2017. REUTERS/Toby Melville/File PhotoSummaryCompanies FTSE 100 down 0.8%, FTSE 250 off 0.6%Aug 2 (Reuters) - UK's FTSE 100 opened lower on Wednesday, as global risk sentiment took a hit after ratings agency Fitch cut the United States' credit rating, while BAE Systems shares jumped after the defence company raised its full-year guidance. By 0709 GMT, the bluechip FTSE 100 index (.FTSE) fell 0.8%, touching a two week low, while the more domestically-focussed FTSE 250 midcap index (.FTMC) lost 0.6%. BAE Systems (BAES.L) added 4.7% after Britain's biggest defence company upgraded its guidance for 2023, forecasting annual earnings per share would grow 10-12%. ConvaTec Group (CTEC.L) jumped 4.0% after the technology firm raised its full-year guidance.

Persons: Toby Melville, Fitch, Shashwat Chauhan, Rashmi Organizations: London Stock Exchange Group, City of, REUTERS, BAE Systems, AAA, Smurfit Kappa, ConvaTec, Thomson Locations: City, City of London, Britain, United States, London, Bengaluru

The downgrade of the United States’ debt by a major ratings firm is a damning indictment of the country’s fractious politics and a blot on its financial record that is unlikely to be quickly erased. But many investors and analysts say it won’t affect the government’s ability to keep borrowing money. On Tuesday, Fitch Ratings lowered the credit rating of the United States one notch to AA+ from a pristine AAA. The firm, citing a “deterioration in governance” along with America’s mounting debt load, suggested that it could be a long time before that decision was reversed. The United States came within days of defaulting on its debt this spring as Republican lawmakers refused to lift the cap unless President Biden made concessions on spending.

Persons: ”, Richard Francis, “, Biden Organizations: United, Fitch, AAA, P, Treasury Department Locations: United States, Americas

☆ Stocks fall, Treasuries gain after Fitch downgrades US rating
▼ + stars: | 2023-08-02 | by ( Xie Yu | ) www.reuters.com time to read: +3 min

REUTERS/Kim Kyung-Hoon/file photoHONG KONG, Aug 2 (Reuters) - Asian stocks traded lower while U.S. Treasury yields declined on Wednesday, after ratings agency Fitch unexpectedly downgraded the United States' top-tier sovereign credit rating. Asian stocks were also weighed by declines on Wall Street overnight. Fitch cut the United States by one notch to AA+ from AAA, citing fiscal deterioration, a decision announced after the Wall Street close on Tuesday. U.S. 10-year Treasury yields declined by about 2 basis points to 4.025% in Tokyo. The United States publishes fresh data on jobless claims and unemployment later this week.

Persons: Kim Kyung, Fitch, Hong Kong's, HSI, Manishi Raychaudhuri, counterintuitively, Steven Ricchiuto, Brent, Xie Yu, Sam Holmes Organizations: REUTERS, U.S, Treasury, United, Japan's Nikkei, AAA, Asia, BNP Paribas, Standard, U.S ., Mizuho Securities, West Texas, Thomson Locations: Tokyo, Japan, HONG KONG, United States, Asia, ., U.S, China

☆ The Fitch analyst behind the U.S. downgrade breaks down the decision—and how the country can regain the top rating
▼ + stars: | 2023-08-02 | by ( Pia Singh | ) www.cnbc.com time to read: +1 min

The Fitch Ratings logo is seen at their offices at Canary Wharf financial district in London, Britain. It's not a growing jobs market, strong U.S. dollar or a resilient economy that will help the U.S. regain the top rating from Fitch. Fitch Ratings cut the United States' long-term foreign currency issuer default rating to AA+ from AAA on Tuesday, sending global stock markets down on Wednesday. "This is a steady deterioration we've seen in the key metrics for the United States for a number of years. That has hindered the U.S. government from coming up with meaningful solutions to deal with growing fiscal issues, particularly around entitlement programs such as Social Security and Medicare, he said.

Persons: It's, Richard Francis, Fitch's, Francis Organizations: Canary, U.S, Fitch, AAA, Democrats, Social Security Locations: London, Britain, United States, Americas

☆ Treasury Secretary Yellen says surprising Fitch downgrade is 'entirely unwarranted'
▼ + stars: | 2023-08-02 | by ( Chelsey Cox | ) www.cnbc.com time to read: +1 min

Treasury Secretary Janet Yellen testifies before the House Financial Services Committee on the state of the international financial system, in the Rayburn House Office Building on Capitol Hill in Washington, DC on June 13, 2023. WASHINGTON — Treasury Secretary Janet Yellen on Wednesday denounced Fitch's decision to downgrade the United States' longstanding credit rating that caused stocks to tumble. Yellen, who spoke during a visit with Danny Werfel, commissioner of the IRS, called the move "surprising" considering the nation's strong economic recovery from the Covid pandemic. Fitch cited "expected fiscal deterioration over the next three years," and "repeated debt-limit political standoffs" when it downgraded the nation's rating to AA+ from AAA. "I strongly disagree with Fitch's decision, and I believe it is entirely unwarranted," Yellen said.

Persons: Janet Yellen, Fitch's, Danny Werfel, Fitch, Yellen, we've Organizations: Financial, WASHINGTON —, AAA, CNBC Locations: Rayburn, Washington , DC, States

☆ Top officials, economists say Fitch's downgrade of the US economy is 'strange' and 'bizarre'
▼ + stars: | 2023-08-02 | by ( Huileng Tan | ) www.businessinsider.com time to read: +3 min

Top economists and administration officials bashed Fitch's downgrade, calling it bizarre. Even Nobel laureate and economist Paul Krugman was baffled about "that bizarre Fitch downgrade," as he posted on X. "I am very puzzled by many aspects of this announcement, as well as by the timing," wrote El-Erian, the chief economic adviser to German financial services giant Allianz. Former Treasury Larry Summers slammed Fitch's downgrade on X, posting that the decision is "bizarre and inept" given that the American economy looks "stronger than expected." Fitch flagged the risk of a US credit rating downgrade in May citing political "brinksmanship" in negotiations over raising the debt ceiling.

Persons: Fitch, there's, bashed, Janet Yellen, Paul Krugman, Mohamed El, Erian, Treasury Larry Summers, Biden Organizations: AAA, Service, Allianz, Treasury, Dow Jones Industrial, Nasdaq Locations: Wall, Silicon

☆ AMD forecast, U.S. credit downgrade drags down chip stocks
▼ + stars: | 2023-08-02 | by ( Ashley Capoot | ) www.cnbc.com time to read: +1 min

AMD Chair and CEO Lisa Su speaks at the AMD Keynote address during the Consumer Electronics Show (CES) on January 4, 2023 in Las Vegas, Nevada. Chip stocks dipped Wednesday, after AMD 's disappointing revenue forecast raised concern that fragility in the PC market and slower spending from businesses may be poised to continue. Marvell fell almost 6%, Nvidia slid close to 5% and Intel and Texas Instruments each declined more than 3%, falling more than the broader tech market. At the same time, the company said a "weaker PC market" dragged second-quarter revenue down 54% in its client segment. Semiconductor companies led a decline in tech stocks, as the market was hit by Fitch Ratings' downgrade of the United States' long-term foreign currency issuer default rating from AAA to AA+.

Persons: Lisa Su, Marvell, Fitch, CNBC's, Jefferies Organizations: AMD, Consumer Electronics, Nvidia, Intel, Texas, Semiconductor, Fitch, AAA, AA, Nasdaq Locations: Las Vegas , Nevada, United States

☆ Stick with Treasurys even after Fitch downgrades U.S., UBS says
▼ + stars: | 2023-08-02 | by ( Brian Evans | ) www.cnbc.com time to read: +2 min

Government bonds are still a sound investment, according to UBS. Fitch attributed the downgrade Tuesday to an "erosion of governance," referring to political standoffs around the debt limit, as well as growing debt levels. The firm expects government debt to reach 118.4% of gross domestic product by 2025. US10Y US2Y YTD line U.S. 2 year and 10 year yields Bond yields move opposite to their prices. She noted that the added benefit of having U.S. Treasurys is they offer the potential for capital appreciation if investors become concerned about slowing growth.

Persons: Fitch, Marcelli, — CNBC's Michael Bloom Organizations: UBS, ., AAA, UBS Global Wealth Management, Treasury, Federal Locations: Americas

That deterioration, as well as increased polarization in the country’s political climate, was visible in the Jan. 6 insurrection, which the agency highlighted in meetings with the Treasury ahead of the downgrade. "It was something that we highlighted because it just is a reflection of the deterioration in governance, it's one of many," he said. "You have the debt ceiling, you have Jan. 6. The latest debt ceiling suspension, agreed in June, will last until early 2025, when another political debate around the borrowing limit is likely, he added. "That would just highlight the real political polarization and the kind of deterioration in governance that we've already noted ... to have a two-notch downgrade would be pretty harsh."

Persons: Donald Trump, Leah Millis, Fitch, Richard Francis, Francis, Janet Yellen, Jared Bernstein, “, we've, Davide Barbuscia, Megan Davies, Ira Iosebashvili, Andrea Ricci Organizations: U.S, Capitol, REUTERS, Fitch, Reuters, AAA, Republicans, Hearst, Standard, Treasury, CNBC, Thomson Locations: Washington , U.S, States, United States

☆ Morning Bid: Markets shake off surprise US credit downgrade
▼ + stars: | 2023-08-02 | by ( ) www.reuters.com time to read: +1 min

A money changer counts U.S. dollar banknotes at a currency exchange office in Ankara, Turkey November 11, 2021. REUTERS/Cagla Gurdogan/File PhotoA look at the day ahead in European and global markets from Brigid RileyFitch delivered the markets a doozy of a surprise with an unexpected downgrade of the U.S. government's credit rating, by one notch to AA+ from AAA, citing concerns over governance and U.S. debt. Japan's Nikkei (.N225) suffered a 1.8% drop, but that's after hovering near post-Bubble highs for most of the past two months. Chinese markets also took a big hit, led by a 2% drop for Hong Kong's Hang Seng. But again, these are markets that had been supported by now-waning hopes for big-bang economic stimulus from Beijing.

Persons: Cagla, Brigid Riley Fitch, Biden, Brigid Riley, Kevin Buckland, Edmund Klamann Organizations: REUTERS, AAA, Treasury, NASDAQ, Japan's Nikkei, Swiss PMI, Thomson Locations: Ankara, Turkey, U.S, Beijing, China's, Swiss, Spain

☆ Cramer explains stock moves after debt downgrade, tells investors to raise cash and curb bullishness
▼ + stars: | 2023-08-02 | by ( Julie Coleman | ) www.cnbc.com time to read: +1 min

CNBC's Jim Cramer on Wednesday explained what the Fitch Ratings debt downgrade might mean for investors and the market as a whole. Cramer attributes this movement not to the problems with AMD or its fundamentals, but to a harried reaction to the downgrade. "Will people react in fear to the Fitch downgrade beyond today? "I'm not concerned about the Fitch downgrade," he continued. Cramer added that he's been seeing recent froth in the market that he finds concerning, and he advised investors to curb their bullishness, raise some cash and wait.

Persons: CNBC's Jim Cramer, Fitch, Cramer, I'm, that's, he's Organizations: Fitch, United, AAA, Devices, AMD Locations: United States

☆ US stocks fall as Dow sheds nearly 350 points after Fitch credit-rating downgrade
▼ + stars: | 2023-08-02 | by ( Phil Rosen | ) www.businessinsider.com time to read: +1 min

US stocks dropped Wednesday, with the Dow shedding nearly 350 points. The sell-off follows Fitch's downgrade of the US debt rating late Tuesday. Wall Street remains skeptical of the downgrade, with Goldman Sachs shrugging it off. Get the inside scoop on today’s biggest stories in business, from Wall Street to Silicon Valley — delivered daily. The downgrade baffled some financial experts, and many Wall Street analysts downplayed it.

Persons: Goldman Sachs, Fitch Organizations: Dow, Service, US, AAA, AA, Capitol, Wall Street, Dow Jones, Nasdaq Locations: Wall, Silicon

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