Amazon surpasses $2 trillion and tech stocks soar thanks to AI

Amazon's market cap surpasses $2 trillion, joining Nvidia, Apple, Alphabet, and Microsoft in the $2 trillion club. Tech stock enthusiasm grows.

Amazon saw its shares surge by 3.9% to reach a closing price of $193.61. This increase pushed the company's market capitalization past the $2 trillion mark for the first time in its history. With this achievement, Amazon joins the ranks of Nvidia, Apple, Alphabet, and Microsoft, all of which have market caps of $2 trillion or more.

Investors have shown a growing interest in tech stocks, particularly those involved in generative artificial intelligence. This surge in enthusiasm has also benefited companies like Nvidia, whose market value skyrocketed from $2 trillion to $3 trillion in just over 3 months. Amazon's shares have also seen a significant rise of 27.5% so far this year, while the Nasdaq has experienced an 18% increase over the same period.

Amazon's Strong Performance

In April, Amazon reported first-quarter earnings, demonstrating a continued rebound in its Amazon Web Services business. This recovery comes after a recent slowdown caused by businesses reducing their cloud spending. Furthermore, Amazon executives have highlighted the potential benefits that AWS can derive from the growing demand for generative AI services.

Investors have expressed their support for Amazon's recent cost-cutting efforts, which have contributed to the company's earnings growth in recent quarters. CEO Andy Jassy has implemented a multiyear strategy to curtail spending, including significant layoffs impacting over 27,000 employees.

Amazon's Market Cap Milestones

Amazon's achievement of surpassing the $2 trillion market cap comes after more than four years. The company initially reached a market cap of $1 trillion in 2020, marking the second time in its history after first achieving this milestone in 2018.

For further insights into the stock market, CNBC PRO provides analysis on the potential fall of Nasdaq stocks in the latter half of the year, along with bold stock predictions from Fundstrat’s Tom Lee and chart analysis of Nvidia's stock by BTIG.

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