US stock futures declined in European trade, suggesting that the benchmark indices may open sharply lower later. ESC1, NQC1
The yield on the benchmark US Treasury note US10YT=RR fell 2 basis points to 4.03 percent on the day, while the cost of insuring US sovereign debt against default remained largely unchanged on the day, providing a sense of long-term calm among investors. represents. Downgrade effect.
Jason Ware, chief investment officer at Albion Financial Group, said, “I don’t think you’ll see a lot of investors, especially investors with a long-term investment strategy, saying I should sell the stock because Fitch is going to take us from AAA to AA+.” Has gone.” ,
Investors use credit ratings to assess the risk profiles of companies and governments when they raise financing in the debt capital markets. Generally, the lower the borrower’s rating, the higher its financing costs.
“It was unexpected, kind of came from left field,” said Keith Lerner, co-chief investment officer at Truist Advisory Services in Atlanta. “As far as the impact on the market, it’s uncertain right now. The market is at a point where it’s somewhat sensitive to bad news.”
