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Amazon and Nasdaq stocks: common fates

Amazon is among the world’s most capitalized companies, and the value of its stock has a significant impact on the Nasdaq index.

Amazon stock and its influence on the Nasdaq index

On the 26th of this month, we will better understand what fate is in store for the world’s largest online marketplace (along with Alibaba), but in the meantime, some important data jumps out at us.

British fiscal policy and the quarterly earnings season steal the spotlight on the performance of Amazon’s shares, which continue to suffer as well as the rest of the big tech stocks from the pressures on bond yields and the performance of the US dollar.

The US currency, while stabilized relative to the Euro and compared to previous weeks, is still too strong and is holding back exports.

American, Italian and German 10-year yields share the same fate, +4.1% America, +4.80% Italy and +2.37% Germany.

Until the bond finds its stability, it is unlikely that equities will touch their lows, and this worries investors.

Marketplace shares in yesterday’s session stopped at $115.07 each with a loss of $1.29 a share and a change of -1.11%.

Nevertheless, Amazon is showing progress. While losses since the beginning of the year show a minus 33%, the reverse parabola is softening with ever smaller losses, which is a sign of a clear recovery in the stock’s strength and an ever-closer bottom. 

Weakness in the dollar and the about-face on fiscal policies in the UK by the Truss pressured by central banks, have generated buying on the pound.

Other big names on Wall Street

Meanwhile, to the surprise of investors, quarterly reports give excellent results and new life to the markets, noteworthy performances by Bank of America (NYSE:BAC) and Bank of New York Mellon (NYSE:BK) in the banking sector, but also by Netflix, Tesla, Apple and Microsoft among the tech majors.

The greater return to risk appetite generates purchases of stocks of the stronger companies including Amazon.

The wait for a recovery in Chinese demand, which has meanwhile focused on neighboring competitor Alibaba, and fears about supplies to Amazon’s logistics hubs in Europe due to Russia’s energy hijackings in Asia are clipping the wings of the stock, at least for the time being.

In the meantime, the company has filed a criminal and civil complaint in Italy and Spain in the second case aimed at countering all those brokers and users who deliberately make false reviews that distort Amazon’s results in terms of sales and reputation.

According to the note issued by Amazon:

“These two proceedings, along with 10 other new lawsuits recently launched in the United States, aim to identify and block operators who currently operate more than 11,000 websites and social groups fueling the market for fake reviews on Amazon and other online stores. in exchange for money or free products.”

The quintessential tech index: the Nasdaq 

With a close below the 11,000-point support (10,680.51), the major US index is still seeing rises and opening up the possibility of further losses. 

The bearish trend continues and the index leaves the field 0.85% despite the release of several positive quarterly reports from companies in its basket of stocks. 

As repeatedly reminded by finance tycoon Warren Buffett, sometimes, the best market hits come precisely when a lead lasts for a long time as in the case of the index’s performance for that matter.

While overseas European stocks are approaching a rebound and Asian stocks have already done so in the wake of Wall Street, investors are shopping in the US following positive earnings sentiment from the latest quarterly reports. 

Both the Nasdaq and Dow Jones, as well as the Standard & Poor 500, remain in the green zone on the weekly (between 2% and 3%) at the turnaround. 

10-year Treasury bonds rising to 4.1% touching 14-year highs to date is not a good sign for insiders.

The bullish trend sparked by the positive Q3 of almost all Nasdaq companies to date is not enough and is being thwarted by the rise in 10-year US Bond rates.

Despite reasonable concerns about the future, demand remains strong and if most of the results of companies exiting between now and the end of the month are positive, there is optimism for a turnaround even though the word bull is still taboo. 

George Michael Belardinelli
George Michael Belardinelli
A former corporate manager at Carifac Spa and later at Veneto Banca Scpa, blogger and Rhumière, over the years he has become passionate about philosophy and the opportunities that innovation and the media make available to us, in particular the metaverse and augmented reality