US stocks open lower after Fitch downgrade

By Ovunc Kutlu

ISTANBUL (AA) - The US stock market opened Wednesday with losses after Fitch Ratings downgraded the US' long-term foreign-currency credit rating to "AA+" from "AAA."

The Dow Jones fell 118 points, or 0.33%, to 35,514 at 9:40 am EDT (1340GMT). The S&P 500 was down 36 points, or 0.8%, to 4,540.

The Nasdaq plummeted 192 points, or 1.34%, to 14,090 at the time.

Fitch said Tuesday the US' rating change reflects expected fiscal deterioration over the next three years, a high and growing general government debt burden, as well as debt limit standoffs and last-minute resolutions.

The agency said it expects the government deficit to rise to 6.3% of gross domestic product (GDP) in 2023, from 3.7% in 2022, while it estimates annual real GDP growth slowing to 1.2% this year, from 2.1% in 2022.

The VIX volatility index, also known as the fear index, jumped 11.1% to 15.48. The 10-year US Treasury yield, meanwhile, rose 0.8% to 4.082%.

The dollar index rose 0.17% to 102.48, while the euro fell 0.25% to $1.0955 against the greenback.

Precious metals were mixed, with gold rising 0.07% to $1,945 per ounce but silver decreasing 0.55% to $24.16.

Oil prices were down around 0.3%, with global benchmark Brent crude at $84.69 per barrel and US benchmark West Texas Intermediate at $81.09.