Standard and Poor's dropped a bomb this morning on the markets
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Stocks, 10-Year Treasuries Fall as S&P Reduces U.S. OutlookApril 18 (Bloomberg) -- U.S. stocks sank the most in a month as Standard & Poor’s Ratings Service cut the nation’s long-term credit outlook to negative. Ten-year Treasuries erased earlier gains and the cost to protect corporate bonds from default climbed to the highest level this month.
The S&P 500 declined 1.5 percent to 1,300.24 at 9:58 a.m. in New York, its biggest drop since March 16. The yield on the 10-year Treasury note climbed three basis points to 3.44 percent after declining four basis points earlier. The dollar was up 1.1 percent at $1.4275 per euro. Gold for June delivery advanced 0.5 percent to $1,493.50 an ounce.
S&P reduced the outlook for the long-term U.S. debt rating to negative from stable, while affirming its AAA long-term and A-1+ short-term sovereign credit ratings. S&P said that more than two years after the beginning of the recent crisis, U.S. policymakers have not agreed on a strategy to reverse recent fiscal deterioration or address longer-term fiscal pressures.