Amazon’s market value exceeded $2 trillion for the first time this week, becoming the fifth U.S. company to surpass that level as optimism rises around artificial intelligence (AI) and potential interest rate cuts this year, which drove demand for technology-related stocks.
Amazon’s stock rose 3.9 percent to $193.61, raising its market value to over $2 trillion and placing it among tech giants like Microsoft, Apple, Nvidia and Alphabet.
The U.S. stock market has recorded significant gains this year as enthusiasm around AI surges and economic resistance hints at a potential interest rate cut.
In the previous session, Wall Street was trading close to record-high levels due to stocks like Nvidia and Amazon, whose future cash flows stand to benefit from lower interest rates.
In February, Amazon stocks entered the blue-chip Dow Jones Industrial Average index and have risen over 26 percent so far this year. During the same month, the company became the fifth biggest U.S. company by market value after Nvidia rose one spot.
Rising AI investments
Amazon Web Services (AWS), the largest cloud services provider in the world, saw a recovery in growth after a decline in 2023 due to its surge in AI adoption. In addition, AWS invested in AI startup Anthropic and robotics firm Figure as it seeks to capitalize on the AI boom.
By the end of 2023, Amazon also revealed a new generation of its custom chips for data centers, targeting applications for machine-learning training and generative artificial intelligence.
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AWS was previously considering investing in the expansion of its data centers in Italy. In mid-May, Amazon also announced a $1.3 billion investment in its French operations to increase cloud infrastructure in the Paris area, which will support France’s generative AI sector and logistics infrastructure.
AWS also announced last month plans to invest €7.8 billion from 2024 to 2040 in the AWS European Sovereign Cloud.
