Stocks fell with the dollar Monday after Moody's removed the United States' last gold standard sovereign bond rating over a debt pile that could balloon further.
The move dealt a blow to markets, which had enjoyed a healthy run-up last week after Washington and China hammered out a deal to temporarily slash tit-for-tat tariffs.
Asian equity markets closed lower, with losses mirrored in European midday deals and US futures trading.
The dollar slid one percent against the euro and fell heavily also against the British pound and yen.
The European single currency powered ahead despite the European Union cutting its 2025 growth forecast for the eurozone, blaming the move on US tariffs.
Focus was also on a landmark EU-Britain summit five years after the latter's acrimonious exit from the neighbouring bloc.
Events across the Atlantic weighed on oil prices, which were down almost 1.5 percent.
Gold, seen as a safe haven investment, jumped one percent in value.
Moody's downgrade, which came late Friday, "has weighed on US equity futures, which are sharply lower on Monday, and it has also knocked the US dollar", noted Kathleen Brooks, research director at XTB trading group.
