US markets dive on opening

US markets have tumbled on opening in their first session since rating agency Standard & Poor’s downgraded the US sovereign rating late on Friday.

All three major indices, the S&P 500; Nasdaq composite; and Dow Jones industrial average fell about two per cent as soon as the markets opened, reinforcing the fears investors have over buying into equities in the current environment.

Oil prices have fallen as investor risk appetite has evaporated, leading to three per cent falls in US crude futures as well as drops in other commodities from copper to grain.

In contrast, gold has reached new record highs and US Treasuries have risen as investors continued to view precious metals and bonds as safer havens than stocks or commodities.