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What the new Labour government means for your money

Now that the dust has settled on the election we can take stock of what a Labour win will mean for your finances

LIVE: FTSE 100 and US stocks pull back as Fitch cuts US credit rating to AA+

A look at how the major markets are performing on Wednesday

Lucy Harley-McKeown
·1-min read
FTSE The statue of George Washington is silhouetted against the U.S. Capitol dome on Capitol Hill in Washington, Monday, Aug. 1, 2011. (AP Photo/Manuel Balce Ceneta)
The downgrade came amid ballooning fiscal deficits and an 'erosion of governance practices', Fitch said. The FTSE was down on Wednesday. Photo: Manuel Balce Ceneta/AP (Manuel Balce Ceneta, Associated Press)

Fitch, a top ratings agency, said late on Tuesday that it is downgrading the US's top-tier sovereign grade one level from AAA to AA+, amid ballooning fiscal deficits and an 'erosion of governance practices'.

The move was announced after market close on the East coast last night.

“The rating downgrade of the United States reflects the expected fiscal deterioration over the next three years, a high and growing general government debt burden, and the erosion of governance relative to ‘AA’ and ‘AAA’ rated peers over the last two decades,” Fitch said.

Markets moved accordingly. The FTSE 100 (FTSE) was down around 1.5% by closing time. Meanwhile the DAX in Germany (^GDAXI) declined 1.4% and France's CAC (^FCHI) pulled back 1,3%. The moves lower continue a downward trajectory for the FTSE, which had fallen the most in nearly a month yesterday.

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US stocks were in the red by market close in Europe. The S&P 500 (^GSPC) slid 1.1%, the Dow (^DJI) pulled back 0.6% and the Nasdaq (^IXIC) was 2% lower.

Read more: Trending tickers: BAE l Travis Perkins l Taylor Wimpey l Kraft-Heinz

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Watch: US stripped of top rating by Fitch

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