Emily Smith
Wed, Aug 2, 2023 9:25 PM

Futures for American Stock Indices Decline as Fitch Cuts U.S. Credit Rating

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Futures for American Stock Indices Decline as Fitch Cuts U.S. Credit Rating
Futures for American stock indices dropped after credit rating agency Fitch downgraded the long-term U.S. credit rating. The downgrade reflects Fitch's pessimistic outlook on the expected financial deterioration over the next three years. However, the American stock market has shown resilience and strong earnings results in recent weeks, suggesting a likelihood of continued rise in stock indices. Investors are eagerly awaiting the second-quarter results of Apple (AAPL) and Amazon (AMZN) and key data releases, including the U.S. jobs report.

Lagos - In a surprising turn of events, futures for American stock indices declined on Tuesday night following a credit rating downgrade by Fitch, one of the prominent credit-rating agencies. Fitch lowered the long-term U.S. credit rating from AAA to AA+, citing its pessimistic outlook on the expected financial deterioration over the next three years.

The news of the credit downgrade coincided with traders assessing the latest batch of second-quarter 2023 earnings results. As a result, Dow Jones Industrial Average futures dropped by approximately 103 points or 0.29%. Similarly, S&P 500 futures and Nasdaq 100 futures declined by 0.44% and 0.63% respectively.

This dip in futures followed a slight decline in the S&P 500 index by 0.27% on Monday, while the Nasdaq fell by 0.43%. However, the Dow Jones index bucked the trend and rose by about 71.15 points or 0.2%, reaching its highest level since February 2022. This surge in the Dow Jones index occurred as the earnings season approached its end, with results surpassing expectations.

The American stock market has displayed resilience and the ability to withstand adverse economic conditions over the past few weeks. Despite market and global financial uncertainties, high earnings results have been achieved. This strength in earnings has created favorable expectations for a continued rise in American stock indices, possibly extending into early 2024. This positive sentiment is gaining significant momentum among investors at the moment.

Investors are eagerly awaiting the second-quarter results of tech giants Apple (AAPL) and Amazon (AMZN), both of which are scheduled to be released on Thursday. These two stocks have already experienced significant gains, with their value increasing by over 50% so far in 2023. Additionally, investors are looking forward to key data releases later in the week, notably the U.S. jobs report on Friday.

July was a strong month for American stock indices, with the S&P 500 and Nasdaq concluding their fifth consecutive month of substantial gains. This sustained positive performance further bolsters the prospects for continued growth in the market.

Source of content: OOO News 2023-08-02 News

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