Market Shifts: Impact of Moody's Downgrade and Tax-Cut Bill

Yields on longer-dated Treasuries surged as the S&P 500 slipped in Monday trading, responding to Moody's recent downgrade of the U.S.'s sovereign credit rating due to fiscal concerns. The rating shift, coupled with the progression of a significant tax-cut bill, sparked market uncertainty.

Late last week, Moody's Investors Service downgraded the U.S. from its top AAA rating, reflecting apprehension over the country's financial stability. Meanwhile, a crucial Congressional committee passed President Donald Trump's extensive tax-cut proposal, with Republicans aiming for swift approval.

The 30-year Treasury yield soared to 18-month highs, reaching 5.037%, driven by fears that the new tax legislation might exacerbate the national debt beyond expectations. Despite these developments, the equity markets largely maintained their trajectory, with officials downplaying the downgrade's immediate impact.

(With inputs from agencies.)