Stock futures tumbled more than 2% at the start of electronic trading Sunday, signaling a nasty investor response to the Standard & Poor's downgrade of U.S. debt. Investors, not to mention political leaders, nervously await reaction of world markets that are scheduled to begin trading later in the evening.
S&P 500 futures fell 28.90 points, or 2.4%, according to data from the Chicago Mercantile Exchange. They were down by as much as 36.80 points.
Nasdaq-100 futures contracts slipped 43.75 points, or 2%. They were down as much as 58.25 points lower earlier.
Dow Jones industrial average futures were 246 points, or 2.2%, lower after being down as much as 309 points earlier
Futures trades are the first gauge of investor sentiment following Friday night's downgrade, removing the United States' AAA status for the first time. They give an indication of how investors will react when regular-hours U.S. trading begins at 9:30 a.m. ET Monday.
Futures trading began at 6 p.m. ET, two hours before the opening of the key Tokyo stock market.
S&P's downgrade followed last week's debt-ceiling agreement that "falls short of what, in our view, would be necessary to stabilize the government's medium-term debt dynamics."
The ratings agency also blasted the partisan bickering that led to the debt ceiling fight, saying ""The political brinksmanship of recent months highlights what we see as America's governance and policymaking becoming less stable, less effective, and less predictable than what we previously believed."
Ahead of the start of futures trading, most economists and investment strategists say that while there could be an initial shock, the downgrade itself should not impact markets too much. Stocks after the downgrade
"S&P doesn't know anything that investors don't already know, so the downgrade should not change expectations and interest rates," said Martin Feldstein, Harvard economist and former head of the National Bureau of Economic Research.
Among other developments Sunday, the White House announced that Treasury Secretary Timothy Geithner will be staying at his post. An administration official told CNN that Geither will stay until at least fall of 2012. To top of page
