Amazon’s share price bounced back on Thursday, rising 1.13% to close at $153.84. The gain snapped a two-day losing streak for the e-commerce and cloud computing giant.
The rally brings Amazon within striking distance of its 52-week high of $155.63, which it reached earlier this week on Tuesday. While still below its peak, the stock is recovering following recent pressures.
Broader Tailwinds Support Amazon’s Rebound
Amazon’s rebound comes amid a broader stock market rally on Thursday. The S&P 500 rose 1.03% while the Dow Jones Industrial Average gained 0.87%.
The uplift reflects improving investor sentiment as markets head into the new year. Appetite for equities appears to be returning after a challenging 2022 environment shaped by factors like inflation and rising rates.
Amazon Outperforms Key Big Tech Peers
Compared to big tech peers, Amazon was a top performer on Thursday. While Apple dipped 0.08%, Microsoft and Alphabet (Google) made more modest 0.79% and 1.53% gains respectively.
Amazon’s rally brings its year-to-date performance essentially on par with Microsoft and Apple. Only Alphabet remains significantly higher, up over 28% in 2022 compared to around a 40% decline for its big tech counterparts.
Still, Thursday’s bounce back suggests Amazon retains underlying investor interest looking into 2023. The company’s sheer size and dominance in high-growth areas like cloud and e-commerce continue providing reasons to stay bullish.
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Holiday Sales Momentum in Focus
Near-term trading in Amazon will likely track holiday sales momentum into year-end. The all-important holiday season represents the company’s largest sales period. Investors want to see consumer demand holding up amidst macro headwinds.
While Amazon has yet to provide specific holiday figures, broader retail numbers are encouraging. Mastercard SpendingPulse reported U.S. retail sales rising 7.6% year-over-year from November 1 to December 24, excluding autos and gas. E-commerce growth remained robust at 11% versus last year.
The resilient demand bodes well for Amazon to deliver strong fourth quarter results when it next reports in February. Competitive holiday sales could catalyze another leg higher in the stock if momentum sustains into 2023.
Final Thoughts
After two down days, bulls took charge to lift Amazon stock over 1% higher. The rally brings Amazon back towards recent highs, with investors retaining an appetite for this e-commerce and cloud juggernaut. Sustained sales momentum into year-end would further boost the bull case heading into the new year.