S&P downgrades France to "AA."

S&P has reduced France's debt rating by one notch to "AA" from "AA+," citing the country's low economic growth and the "inability to significantly reduce total government spending." The ratings agency believes that tax, labor and other reforms won't raise France's growth prospects, while high unemployment is damaging support for further structural and fiscal measures. The CAC 40 (EWQ) was -0.7% at the time of writing, but French 10-year bond yields were just +3 bps to 2.27%.