US Credit Rating and Market Dynamics
Moody’s downgraded the US credit rating to Aa1 from AAA, the first such occurrence in history, yet 10-year Treasury yields rose only slightly. In the wake of tariff reductions, US equity markets performed significantly better than Chinese counterparts, with the S&P 500 up around 5% while the CSI 300 only gained over 1%. Concerns linger over China’s economic health amidst rising tariffs and ineffective stimulus, negatively impacting investor sentiment despite some sector-specific gains in Chinese healthcare and financials.
