World equities,fresh from their worst week since the 2008 global financial crisis on eurozone debt fears,face more turmoil after Washington lost its AAA rating,analysts said today. Standard & Poor's cut the rating to AA+ with a negative outlook,saying US politicians were increasingly unable to come to grips with the country's huge fiscal deficit and debt load. "The news that S&P finally pulled the trigger. will surely rock the financial markets when they open on Monday," said Capital Economics analyst Paul Dales. And he warned: "If the market mayhem continues,the risks of a recession will rise further." European markets had slumped last week on concerns that the eurozone debt debacle,which threatens to engulf Italy and Spain and the faltering US economy could spark another vicious worldwide downturn. London's FTSE 100 index plunged by almost ten percent,wiping 150 billion pounds (USD 246 billion,173 billion euros) off the value of top British companies,to register its worst weekly loss since November 2008. Wall Street also suffered its worst week since the financial crisis,shedding 5.75 percent despite yesterday's better-than-expected US jobs report and hints of progress in Europe's debt crisis. The S&P move,which followed persistent downgrade rumours in markets,will send investors hunting for safer assets and away from risky equities,according to Lloyds TSB Corporate Markets economist Charles Diebel.
