Will Europe’s shaky financial situation cross the pond to the U.S.?
- Moody’s – a major credit rating agency – handed Greece an awful credit score on Monday, and Wall Street reacted with a distinct slump.
- The low credit score means low confidence in Greece’s ability to dig out of its debt crisis. Even the bailout plan set out by Greece’s neighbors wasn’t enough to convince the analysts at Moody’s that things would turn around anytime soon.
- The fact that the U.S. market reacted so directly to this news illustrates the strong link between the European and U.S. economies. Still, analysts predict that the U.S. economy will continue to grow despite this temporary setback.
Facts & Figures
- The DJIA was down 20.18 points (-0.2%) by the end of Monday
- At the same time, the value of Bank of America stock fell 1.22% and JPMorgan stock dropped 2%
Best Quote
“It was not a huge surprise that Moody’s is following suit. But it is another reminder of the negative news stream coming out of Europe.” – Win Thin, Currency Strategist, Brown Brothers Harriman