After friday’s market close in the US, Moody’s announced that it had downgraded the U.S. credit rating from Aaa to Aa1
In case you are wondering if this is happening for the first time that a top credit rating agency downgraded US, No, Fitch Ratings did it in 2023 and S&P did it way back in 2011.
This is the full official report from Moody’s - Ratings.Moodys.com
How US stock markets reacted last time to rating downgrades?
- In 2011, S&P downgrade came in a similar style like yesterday and the markets panicked on Monday with The S&P 500 falling 6.6% the Dow Jones falling 5.5%, and the NASDAQ falling 6.9%
- In 2023, When Fitch ratings downgraded, The immediate reaction was not as a bad as 2011, In fact, US markets were hardly down between 1-2% the next day with correction continuing for a couple of months before pausing at 7-8% correction after which markets recovered swiftly https://www.reuters.com/markets/global-markets-wrapup-1-2023-08-02/
What can happen this time?
Definitely more fireworks than usual as we had Obama and Biden as Presidents but we now have TRUMP who has definitely got the content to talk about for 1-2 weeks 
While we have historical precedents (2 in this case), like always, this time, the situation is completely different, with more uncertainty about the Global economy than ever. There’s chaos everywhere, especially with Tariff drama, higher bond yields, and a more challenging geopolitical landscape.
I’m personally super bearish on US as an Economy in the coming years but more bearish on US stock markets in all time frames short - medium and long term. Lets see how it plays out