Chapter 1: Weekly Business Highlights

The financial markets displayed a mixed outcome on Friday, yet overall, there were commendable gains throughout the week. The surprisingly moderate inflation data from the U.S. has sparked optimism that the Federal Reserve may soon pause its interest rate hikes. The latest consumer and producer price reports for June indicated smaller-than-anticipated increases, prompting investors to contemplate the potential for rising stock prices by year-end, backed by a robust economy. Earnings season commenced on Friday with major banks reporting, but investor sentiments for this period remain somewhat gloomy.

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Section 1.1: Market Performance Overview

Despite the cautious outlook, all three major stock indices posted weekly gains. The Dow Jones and Nasdaq recorded their best percentage increases since March, rising by 2.3% and 3.3% respectively, while the S&P marked a 2.4% increase—its largest weekly gain since mid-June. Key growth sectors, particularly Communication Services, Consumer Discretionary, and Technology, significantly contributed to the market's positive performance.

Subsection 1.1.1: Currency Trends and Fed Projections

Recently, the U.S. dollar has fallen to multi-month lows against other currencies, reflecting a resurgence of bearish sentiment. This decline, coupled with the breach of critical support levels, strengthens the pessimistic outlook for the dollar. The substantial fluctuations in the USD following the jobs report and CPI data indicate market belief that the Federal Reserve is nearing the end of its tightening cycle. Current futures pricing suggests a near certainty of a final 25-basis point hike during the July 25–26 meeting, followed by anticipated rate cuts in early 2024, as per the CME FedWatch tool.

This contrasts with the Federal Reserve's expectations of two additional rate hikes by year-end, with no cuts anticipated until 2025. From a technical standpoint, the DXY index's fall below an upward trendline near the April low of 100.80 has triggered a bearish break from a triangle pattern, suggesting a continuation of the downward trend with a high likelihood of further declines. With key support levels breached, the focus now shifts towards the 200-week moving average around 98.25, potentially extending towards 96.50.

Chapter 2: Cryptocurrency Market Developments

The cryptocurrency market, particularly Bitcoin (BTC), experienced increased volatility at the week's close, fueled by Ripple's landmark legal victory against the SEC. BTC surged from just under $30,500 to a 13-month peak exceeding $31,800 after a ruling determined that most XRP transactions do not constitute securities. However, BTC was unable to maintain this upward trajectory, retracting several hundred dollars by Friday, and subsequently dropping below $30,000 for the third time that week.

Nevertheless, bulls reentered the market, helping BTC reclaim this crucial psychological threshold by Saturday. As expected, the SEC-Ripple ruling positively influenced many altcoins, especially XRP, whose price nearly doubled within hours to a 19-month high of $0.95. However, it faced a notable retracement in the days following, currently trading slightly above $0.70. Ethereum (ETH) briefly crossed the $2,000 mark but has since declined to around $1,930 following a two-day downturn. Additionally, Binance Coin (BNB) has dipped below $250.

From 1980 to 2022, the S&P 500 has averaged an annual return of 10%, excluding dividends, but certain companies can yield significantly higher returns in specific years. The following graphic, utilizing data from S&P Dow Jones Indices, explores the top-performing S&P 500 stocks with the most remarkable single-year returns over the past four decades.

Chapter 3: The Rise of App Economy

Over the last 15 years, the proliferation of apps has transformed various facets of our lives, reshaping how we communicate, play games, date, listen to music, and more. This transition has also opened substantial opportunities for independent developers around the globe. According to a study commissioned by Apple, app downloads have surpassed 370 billion in this timeframe. Moreover, developers have generated over $320 billion from the App Store since its inception.

The economic impact of the App Store goes beyond these figures. The Analysis Group reported that the App Store facilitated more than $1.1 trillion in billings and sales last year, surpassing the estimated total of $519 billion in 2019. A significant portion of this revenue stems from the sales of physical goods and services within iOS apps, which accounted for 81% of the overall sales and billings facilitated by the App Store last year, with general retail emerging as the largest segment.

Chapter 4: Global Inflation Trends

Global headline inflation seems to have peaked, and core inflation has shown signs of easing, especially in India. Yet, in most G20 nations, particularly advanced economies, inflation continues to exceed central bank targets. Initial signs indicate that efforts to combat inflation are beginning to affect economic activity, as evidenced by tightened bank lending standards in the euro area and the U.S. However, policymakers must tread carefully to avoid hasty conclusions.

Lessons learned from previous inflationary periods underline the risk of reversing progress by easing policies prematurely. A consistent monetary policy approach is essential until inflation is sustainably reduced to desired target levels. Additionally, it is crucial to remain vigilant regarding risks within the financial sector. Clear communication from central banks and robust oversight of the financial sector are vital for minimizing disruptive shifts in financial conditions.

Chapter 5: Digital Assets and ESG Considerations

This week, CCData, in partnership with the Crypto Carbon Ratings Institute (CCRI), launched its first ESG Benchmark report. The report evaluated 40 of the largest and most liquid digital assets based on essential ESG criteria, including decentralization and environmental impact. According to PwC's late-year findings, assets under management related to ESG could reach $33.9 trillion by 2026, representing a significant share of global investments.

This ESG Benchmark was developed in response to the increasing demand from ESG-conscious investors and aims to aid in the formation of crypto ESG indices and financial products. Notably, Ethereum received an AA grade, making it the only asset to achieve this in the inaugural ESG Benchmark. Solana and Cardano followed closely with A grades. However, despite Bitcoin's commendable performance in social and governance aspects, it ranked 20th overall due to its substantial energy consumption. The report highlighted that 90% of the electricity consumed by the assessed assets was attributable to Bitcoin, while several Proof-of-Stake assets utilized significantly less energy—up to 10,000 times less than the largest digital asset.

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