“The S&P 500 closed up 2.47% on Friday, green for the week. The first time this has happened in 8 weeks. Bitcoin and the rest of the crypto market remained volatile, sinking below $30k once again. LUNA was relaunched and Litecoin activated its privacy upgrade.”
Stock Market Roundup
The S&P 500 closed just above 4158 on Friday, marking the first green week after 7 consecutive weeks of losses. The S&P 500 gained over 6% last week, while during the week preceding it shed 2.5% of its value. The Nasdaq100 has fared even better, gaining almost 7% last week. Arguably, the markets were buoyed by Monday 23rd’s Fed meeting, which confirmed the already planned rate hikes and added no new surprises. Although the market on the whole rebounded, certain stocks have not had a strong fortnight. In particular, Snapchat announced after hours on Monday 23rd May that they expect their Q2 quarterly results to be far worse than their guidance originally suggested. Snapchat fell 40% on Tuesday. With Snapchat reporting slowing revenues, other advertisers fell in sympathy, with Alphabet falling almost 8% and Meta 10%. Yet, both Meta and Alphabet regained the losses over the rest of the trading week.
The UK government announced a windfall tax on energy firms, in an aim to combat the cost-of-living crisis. The tax has been largely welcomed by the public, while many oil giants warned such a tax could have negative impacts on domestic energy projects. Despite this, BP gained 1.78% last week and Shell 1.3%. The FTSE100 over the last 2 weeks has increased 1.6% in total, while the FTSE250 has gained almost 2%. UK CPI figures were released on 18th May, showing inflation hit 7.8%, a 1.6 percentage point increase from March. According to the Office for National Statistics, the largest contributions came from energy and housing costs. GBP/USD currently sits at 1.26, having risen over 2.4% since mid-May.
Elsewhere, Anthony Albanese was elected as the new Australian Prime Minister. Left-leaning, Albanese promotes investing in child-care, the declining manufacturing industry, and is also going to prioritise national security. Over the last two weeks, the ASX200 has climbed over 1%.
Crypto Remains Volatile As Ever
Crypto has yet again had a tumultuous time. Bitcoin has hovered around the $29k mark, with a number of dips to $28k. Bitcoin has tested $30k a number of times, but cannot find support to stay above the line. Ethereum has fallen from $2100 to $1800, a fall of over 14%. The market cap of the crypto market now stands at $1.2 trillion. Digital assets have become JP Morgan’s preferred alternative asset, according to their latest alternative investment outlook strategy. JP analysts believe that Bitcoin currently has a 28% upside. With almost a completely opposite sentiment, the President of the European Central Bank, Christine Lagarde, claimed that crypto assets are “worth nothing”. Litecoin’s ‘MimbleWimble’ upgrade was launched without a hitch, allowing privacy optionality for LTC transfers. LTC’s price has since suffered falling almost 14% over the last week, with the upgrade doing little to protect itself against the market’s negative momentum.
In the Queen’s speech, a bill to legalise and regulate stablecoins was proposed. At the same time, G7 ministers have advocated “clear and comprehensive regulation” of crypto assets. These announcements come soon after UST’s spectacular implosion at the beginning of May. USDT, the world’s largest stablecoin, has seen a great number of conversions from the stablecoin to USD. Over the last month, its market cap has fallen from $83 billion to $72 billion, akin to a crypto bank run. Despite investor concerns about whether USDT truly has a 1:1 USDT/USD backing, USDT has maintained its dollar peg incredibly well.
In Other News…
FTX CEO, Sam Bankman-Fried, stated that “Bitcoin has no future as a payment network” due to the asset’s high costs and low throughput. He added that BTC still has a role to play as a store of value.
Seth Green’s new show ‘White Horse Tavern’ was put in jeopardy as his Bored Ape NFT was stolen. Green’s series was supposed to focus on Bored Ape #8398 acting as a “friendly neighbourhood bartender”. It is still unclear if the show will go ahead due to Green no longer possessing the NFT.
GameStop launched their new NFT wallet, utilising Loopring’s technology as an L2 scaling solution. LRC soared over 30% on the news.
Ted Cruz aims for Texas to be “the oasis on Planet Earth for Bitcoin and crypto”. At the same time, Cruz denounced Central Bank Digital Currencies (CBDCs) calling them a “very dangerous idea”.
LUNA was relaunched as LUNA 2.0. Plans are currently in place to compensate previous UST and LUNA holders with the new currency. LUNA 2.0 plunged 75% on its first day of trading. The old LUNA is now “LUNA Classic”.
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