December S&P 500 futures (ESZ23) are down -0.22%, and December Nasdaq 100 E-Mini futures (NQZ23) are down -0.29% this morning as risk sentiment took a hit after rating agency Moody’s lowered the United States’ credit rating outlook while investors looked ahead to the release of U.S. inflation data as well as quarterly earnings reports from high-profile retailers.
Moody’s Investors Service lowered its assessment of the U.S. credit outlook from “stable” to “negative” on Friday, citing the U.S.’ “very large” fiscal deficits and partisan gridlock in Washington. While the rating agency reaffirmed America’s credit rating at AAA, the highest level, the lowered outlook suggests the rating could slip in the future. “In the context of higher interest rates, without effective fiscal policy measures to reduce government spending or increase revenues, Moody’s expects that the U.S.’ fiscal deficits will remain very large, significantly weakening debt affordability,” the statement said.
