Market Midday Update: Indexes Tumble Following Moody’s Downgrade
Major Indexes Retreat as Markets React to US Credit Rating Cut
As of midday Monday, May 19, 2025, major U.S. stock indexes are trading significantly lower, continuing the downward trend that began in pre-market trading. The selloff comes after Moody’s Ratings stripped the United States of its top credit rating late Friday, downgrading it one notch to Aa1 from Aaa.
The S&P 500 is down 1.2%, halting its impressive five-day winning streak from last week. The Dow Jones Industrial Average has fallen more than 200 points, while the Nasdaq Composite is showing the steepest decline among major indexes, reflecting weakness in technology stocks.
Treasury yields have surged in response to the downgrade, with the yield on 30-year Treasuries exceeding 5% for the first time since November 2023. Meanwhile, gold prices have rebounded sharply as investors seek safe-haven assets amid the equity market turbulence.
Tech Stocks Lead Market Decline
Technology stocks, which had been driving market gains in recent months, are leading today’s selloff. The “Magnificent Seven” tech giants are all trading lower:
– Tesla (TSLA) has dropped approximately 4% in midday trading, extending its year-to-date decline to over 30%.
– Nvidia (NVDA) is down about 2%, adding to its nearly 19% loss for the year.
– Apple (AAPL) has fallen more than 1%, with the stock now down about 15% in 2025.
– Microsoft (MSFT) is trading lower by over 1%, despite recently beating earnings expectations.
– Alphabet (GOOGL) has declined more than 1%, with the stock down over 16% year-to-date.
– Meta Platforms (META) and Amazon (AMZN) are also trading lower, with both stocks showing significant year-to-date losses.
Other notable tech decliners include Palantir and Super Micro Computer (SMCI), both down approximately 4% in midday trading.
Upcoming Market Events to Watch
Several companies are reporting earnings today, which could impact market sentiment in the afternoon session:
Before Market Open:
– ICL Group (ICL) reported quarterly earnings of $0.08 per share, meeting analyst expectations.
– ZIM Integrated Shipping Services (ZIM) announced earnings of $1.89 per share, representing a 152% increase compared to the same quarter last year.
– Global Ship Lease (GSL) and several other companies also reported results this morning.
After Market Close:
– Trip.com Group (TCOM) is expected to report quarterly earnings of $0.86 per share on revenue of $1.91 billion.
– Agilysys (AGYS), 8×8 (EGHT), and Qifu Technology (QFIN) are among other notable companies reporting after today’s closing bell.
Economic Data and International Markets
On the economic front, China released several key economic indicators early today, with industrial production growing 6.1% year-over-year in April, exceeding expectations of 5.5%. Chinese retail sales rose 5.1%, while the unemployment rate improved slightly to 5.1% from 5.2%.
European markets are also trading lower, with Germany’s DAX 30 down 0.20%, the UK’s FTSE 100 falling 0.28%, and France’s CAC 40 declining 0.41%.
Looking Ahead
Investors will be closely monitoring the market’s reaction to today’s earnings reports and assessing the longer-term impact of the Moody’s downgrade on U.S. assets. The downgrade comes after a strong previous week for Wall Street, where the Nasdaq jumped over 7% and the S&P 500 gained on all five trading days, ending 5% higher on a weekly basis.
Market participants will also be watching for any policy responses from Washington regarding the credit rating cut and potential implications for government borrowing costs in the coming weeks.
