What do investors think about the US credit downgrade?

Fitch downgraded US credit

Last Tuesday, after the bell, Fitch decided to downgrade the US credit ratings from AAA to AA+.

The main reasons why Fitch has announced the downgrade are based on worsening fiscal conditions and governance.

The US stock market reacted with a bad performance yesterday.

The S&P 500 fell 1.38%, marking its biggest daily percentage decline since 25 April.

The Tech-heavy Nasdaq Composite dropped 2.17%, its worst one-day performance since February.

The Dow Jones closed the trading session with a loss of 0.98%.

Investors, however, are not worried about the US credit downgrade and strongly believe in the solid conditions of the US credit.

Yesterday’s stock market drop, in fact, has been seen as physiological, after the recent bull run and expected.

Meanwhile, the US Treasury Secretary Janet Yellen, said she disagreed with Fitch’s decision, commenting the downgrade as “arbitrary and based on outdated data”.

Today’s events to watch

The US Labour Department will publish the weekly initial jobless claims data at 13:30 GMT+1.

The Institute of Supply Management will publish the Non-Manufacturing Purchasing Managers’ Index (PMI) at 15:00 GMT+1.

Aftermarket, the tech giants Apple and Amazon are going to report their quarterly earnings results.

Portfolio update

I am rebalancing my portfolio gradually.

I recently took a profit on some long positions on stocks.

I am adding new positions and will close some in the upcoming months.

If you are already copying my portfolio, please keep the copy open.

If you are thinking of copying me, now could be the right time, if you can invest for the long term (years).

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Thank you, everyone. Have a nice day!

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1. Create an eToro account here: https://federicamontella.com/go/etoro/

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5. Enjoy, it’s all automatic. You will make passive income 24/7

Let me know if you have any questions.


Federica Montella

eToro Popular Investor


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Author: Federica Montella
eToro Popular Investor, food lover and blogger. Stock trader and Popular Investor at eToro. I am on a mission to find the best restaurants and food to eat.