Amazon Inc. achieved a market value of $2 trillion for the first time on Wednesday, becoming the fifth U.S. company to reach this milestone.
The increase in valuation was fueled by growing optimism about artificial intelligence and anticipated interest rate cuts this year, boosting demand for tech stocks.
Amazon's stock climbed 3.4% to $192.70, raising the e-commerce giant’s market value above $2 trillion and positioning it among other tech leaders like Microsoft Corp, Apple Inc., Nvidia Corp., and Alphabet.
U.S. stock indexes have experienced significant gains this year, driven by strong enthusiasm for AI, confidence in the U.S. economy's resilience, and the potential for Federal Reserve interest rate adjustments. Wall Street has approached record levels, largely influenced by major stocks like Nvidia and Amazon, which benefit from lower interest rates due to their substantial future cash flows.
Since joining the blue-chip Dow Jones Industrial Average index (.DJI) in February, Amazon's shares have risen over 26% this year, making it the fifth largest U.S. company by market value following Nvidia's recent growth. Amazon Web Services remains the leading cloud services provider globally, with renewed growth driven by increased AI adoption after a previous slowdown.
Additionally, Amazon has invested in AI startup Anthropic and robotics firm Figure, aiming to capitalize on the expanding AI sector. Late last year, Amazon introduced a new generation of custom-designed chips for data centers, targeting machine-learning training and generative artificial intelligence applications.
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