Stock market today: Wall Street opens lower as this year’s rally cools some more

Aug 2, 2023, 10:54 PM

NEW YORK (AP) — Stocks are falling again as Wall Street’s red-hot rally this year cools a bit more. The S&P 500 fell 0.5% early Thursday, on pace for a third straight loss after hitting a 16-month high. The Dow fell 118 points, or 0.3%, and the Nasdaq composite was down 0.5%. Treasury yields in the bond market continued to march higher, putting more pressure on the stock market. Yields have climbed as the economy has remained remarkably resilient despite much higher interest rates meant to drive down inflation. A report on Thursday about unemployment claims indicated the job market is still solid.

THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.

BEIJING (AP) — Global stock markets and Wall Street futures declined Thursday after Fitch Ratings cut the U.S. government’s credit rating.

London and Paris opened lower. Tokyo lost 1.7% and Hong Kong also declined. Shanghai advanced. Oil prices retreated.

Wall Street turned in its biggest one-day decline in months Wednesday after Fitch Ratings lowered the U.S. government credit rating by one level. The agency cited rising debt and a “steady deterioration in standards of governance” after Congress pushed Washington close to defaulting before agreeing to raise the amount it can borrow.

“This is largely irrelevant despite some initial shock,” Kristina Hooper, chief global market strategist at investment management company Invesco, said in a report, noting that this makes the U.S. rating more consistent with other major economies. “The timing was odd, given that it occurred well after the debt ceiling issue was resolved.”

In early trading, the FTSE 100 in London lost 1.3% to 7,466.49. The CAC 40 in Paris retreated 0.9% to 7,246.21, and the DAX in Frankfurt gave up 0.8% to 15,883.21.

On Wall Street, the future for the benchmark S&P 500 index was 0.3% lower. For the Dow Jones Industrial Average, it declined 0.2%.

The S&P 500 sank 1.4% on Wednesday after Fitch cut the U.S. government debt rating from the highest level of AAA to AA+. It was the second-straight loss for the market benchmark after last week’s 16-month high.

The Dow dropped 1%, and the Nasdaq composite fell 2.2%.

In Asia, the Nikkei 225 in Tokyo tumbled to 32,159.28 and the Hang Seng in Hong Kong lost 0.5% to 19,420.87. The Shanghai Composite Index rose 0.6% to 3,280.46.

The Kospi in Seoul gave up 0.4% to 2,605.39, and Sydney’s S&P-ASX 200 declined 0.6% to 7,311.70.

India’s Sensex lost 1% to 65,116.42. Jakarta gained while New Zealand and other Southeast Asian markets declined.

The Fitch downgrade strikes at the core of the global financial system because U.S. Treasuries are considered some of the safest possible investments. The agency cited repeated standoffs in Congress about whether to cause the government to default, among other factors.

Standard & Poor’s stripped the U.S. of its AAA rating in 2011 after a fight over the government’s borrowing limit. The Government Accountability Office later estimated that budget standoff raised borrowing costs by $1.3 billion that year.

Investors are watching whether the U.S. economy can avoid a recession that was widely expected following repeated interest rate hikes to cool inflation.

Traders have been more optimistic lately, helping to push up the S&P 500 by 19.5% for the first seven months of this year.

A report Wednesday by payroll processor ADP suggested hiring in the private sector is stronger than expected, even if it slowed in July from the previous month. Strong hiring could help to dampen fears of a recession but also might persuade the Federal Reserve there is too much upward pressure on prices.

The U.S. government is due to issue more comprehensive jobs data Friday. Fed Chair Jerome Powell has pointed to Friday’s numbers as a big influence on the central bank’s next move in September.

On Wall Street, Microsoft, Nvidia and Amazon each fell more than 2.5% on Wednesday.

Generac Holdings, which sells generators and other power products, tumbled 24.4% for the biggest drop in the S&P 500 after it reported weaker profit than analysts expected.

SolarEdge Technologies dropped 18.4% after reporting weaker profit and revenue growth than forecast. It said higher interest rates were pressuring U.S. residential customers.

Other companies have been beating profit expectations.

CVS Health rose 3.3% after it reported a milder drop in results than expected. Humana climbed 5.6% after it topped expectations.

In energy markets, benchmark U.S. crude lost 43 cents to $79.06 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell $1.88 the previous day to $79.49. Brent crude, the price basis for international oil trading, gave up 54 cents to $82.66 per barrel in London. It lost $1.71 the previous session to $83.20.

The dollar rose to 142.89 yen from Wednesday’s 143.28 yen. The euro declined to $1.0927 from $1.0943.

United States News

FILE - This undated file photo shows members of the Grateful Dead band, from left to right, Mickey ...

Associated Press

The Grateful Dead and Francis Ford Coppola are among the newest Kennedy Center Honors recipients

WASHINGTON (AP) — An iconoclastic filmmaking legend and one of the world’s most enduring musical acts headline this year’s crop of Kennedy Center Honors recipients. Director Francis Ford Coppola and the Grateful Dead will be honored for lifetime achievement in the arts, along with jazz trumpeter Arturo Sandoval, blues legend Bonnie Raitt and the legendary […]

20 minutes ago

Republican presidential candidate former President Donald Trump talks to Sen. Marco Rubio during th...

Associated Press

2024 Election Latest: Trump to speak at RNC as convention enters fourth day, Biden has COVID-19

The Republican National Convention culminates Thursday with former President Donald Trump expected to accept the party’s presidential nomination, achieving a comeback four years in the making and anticipated even more in the past week in light of Saturday’s assassination attempt. He is expected to accept his third consecutive party nod in prime time before thousands […]

41 minutes ago

Wall Street Journal reporter Evan Gershkovich stands in a glass cage in a courtroom in Yekaterinbur...

Associated Press

U.S. reporter Evan Gershkovich appear in court in Russia for hearing on espionage charges

Wall Street Journal reporter Evan Gershkovich appeared in court in Russia on Thursday for the second hearing in his trial on espionage charges, the court said. Gershkovich, his employer and the U.S. government vehemently deny the charges against him. Gershkovich was accused by the Russian Prosecutor General’s office of “gathering secret information” on orders from […]

6 hours ago

FILE - A pedestrian traverses the rotunda inside the New Mexico Capitol, March 16, 2023, in Santa F...

Associated Press

New Mexico governor cites ‘dangerous intersection’ of crime and homelessness, wants lawmakers to act

SANTA FE, N.M. (AP) — Citing what she calls the “dangerous intersection” of crime and homelessness, New Mexico’s governor is calling on lawmakers to address stubbornly high crime rates as they convene Thursday for a special legislative session. In issuing her proclamation, Gov. Michelle Lujan Grisham talked about a vulnerable segment of society that falls […]

7 hours ago

Republican presidential candidate former President Donald Trump arrives on third day of the Republi...

Associated Press

FACT FOCUS: Trump, in Republican convention video, alludes to false claim 2020 election was stolen

DONALD TRUMP, alluding that the 2020 vote was stolen: “Whether you vote early, absentee, by mail or in person, we are going to protect the vote. That’s the most important thing we have to do is protect the vote. Keep your eyes open because these people want to cheat and they do cheat. And frankly, […]

8 hours ago

Follow @ktar923...

Sponsored Content by Sanderson Ford

3 storylines to get you revved up for the 2024 Arizona Cardinals

Arizona Cardinals training camp is just a couple weeks away starting on July 25, and Sanderson Ford is revved up and ready to go.

Sponsored Articles


Condor Airlines

Condor Airlines can get you smoothly from Phoenix to Frankfurt on new A330-900neo airplane

Adventure Awaits! And there's no better way to experience the vacation of your dreams than traveling with Condor Airlines.



Desert Institute for Spine Care is the place for weekend warriors to fix their back pain

Spring has sprung and nothing is better than March in Arizona. The temperatures are perfect and with the beautiful weather, Arizona has become a hotbed for hikers, runners, golfers, pickleball players and all types of weekend warriors.



Here are 5 things Arizona residents need to know about their HVAC system

It's warming back up in the Valley, which means it's time to think about your air conditioning system's preparedness for summer.

Stock market today: Wall Street opens lower as this year’s rally cools some more