The markets opened sharply lower in response to Standard & Poor's downgrade of the nation's credit rating on Friday after market close. The Dow collapsed 319 points to 11,124 while Nasdaq sank 97 points to 2433.

On the upside

Broadsoft (Nasdaq: BSFT) reversed year ago losses to post a better than expected profit for the second quarter as revenue surged prompting the company to lift its full year outlook.

On the downside

American International Group (NYSE: AIG) announced plans to sue Bank of America (NYSE: BAC) for more than $10 billion in losses stemming from mortgage debt fraud.

The National Highway Traffic Safety Administration launched a preliminary investigation into Ford's (NYSE: F) 2011-2012 manual transmission Mustangs for possible problems with shifting.

Citadel initiated coverage of Dendreon (Nasdaq: DNDN) with a Neutral rating.

The Bedford Report issued a research paper saying that the cost of increased production at SandRidge Energy (NYSE: SD) may negatively impact earnings as oil prices have tumbled.

Quicksilver (NYSE: KWK) reported higher second quarter earnings and revenue that topped estimates but the stock price fell.

In the broad market, declining issues outpaced advancers by a margin of more than 11 to 1 on the NYSE and by nearly 7 to 1 on Nasdaq. The Russell 2000 which tracks small cap stocks plunged 18 points to 696.