Stocks fell Wednesday after Fitch downgraded the long-term rating for the U.S. and traders scrutinized the latest batch of second-quarter earnings results.
The Dow Jones Industrials stumbled 215.12 points to begin Wednesday at 35,415.16.
The S&P 500 Index let go of 47.07 points, or 1%, to 4,529.66.
The NASDAQ index staggered 251.75 points, or 1.8%, to 14,032.16.
Fitch Ratings cut the long-term foreign currency issuer default rating for the U.S. to AA+ from AAA Tuesday night, citing “expected fiscal deterioration over the next three years.”
On top of that, a busy earnings week carried on. Advanced Micro Devices was flat despite better-than-expected results. CVS Health rose 2% after posting strong earnings as it trims costs. SolarEdge Technologies tumbled 16% after missing second-quarter revenue expectations.
Earnings season is more than halfway through with results coming in stronger than expected. Of the S&P 500 companies that have reported, about 82% have posted positive surprises. The earnings beats have added to bullish investor sentiment, continuing this year's recovery.
Elsewhere, the latest ADP jobs report showed 324,000 private payrolls added in July. That far exceeded the jobs gains expected by economists polled by Dow Jones, but marked a decrease from June's downwardly revised 455,000.
Prices for the 10-year Treasury tumbled, raising yields to 4.10% from Tuesday's 4.03%. Treasury prices and yields move in opposite directions.
Oil prices dipped 58 cents to $80.79 U.S. a barrel.
Gold prices added $1.50 to $1,980.30 U.S. an ounce.