It’s summer, Corona is not raging as violently as it was a few months ago. Many people go shopping again, the shops are open, and all of this is reflected in the stock exchanges. There was a previously rare sight on Friday. If you looked at the top-and-flop list of the American stock market index Nasdaq 100, this time you found a name at the bottom of the list that has mostly been at the top of the table in recent months: Amazon.
Is this just a temporary phenomenon due to the volatility of the stock markets, or the beginning of a trend reversal?
Amazon’s statement published after the stock market closed in the USA is quite clear. Of course, it has no significance for the long-term development of the share price, and yet it is important: The Internet company expects the shopping boom on the Internet to subside. It is all about the extraordinarily high growth dynamics of the past few months. Experts undisputed that online trading will remain at a high level, including in Germany. But the hype seems to be over for now. After the announcement by Amazon, the company’s share price collapsed by more than seven percent at times. An Amazon share was “only” worth a good 2800 euros.
Amazon’s sales growth had already declined more sharply in the past few months than many analysts had expected. And that was not just due to the stationary stores that were reopened. Market observers had also registered that the Prime Day discount battle held this time in June fell short of expectations.
Amazon also announced that people will probably not spend as much money on its platform in the coming months as they did a year ago. Amazon is “only” assuming a plus of around 16 percent compared to the same period of the previous year, which is objective and a lot compared to other companies. But by Amazon standards less than before – and that’s what matters at the stock exchange. Not a good start for the new company boss Andy Jassy, who took over the post from Amazon founder Jeff Bezos at the beginning of July, who prefers to go with him in between New Shepard to rush through other spheres.
Because his earthly life’s work has taken on such huge dimensions, the fall of Amazon’s shares also dragged other online companies into the downward spiral.
In Germany, the shares of the online fashion retailer Zalando lost in value, at times by more than four percent. The furnishing platforms Westwing and Home24 were also under pressure. However, the rashes were not large.
It looked similar internationally. The stocks of online companies such as Alibaba, Jd.com, Shopify, Ebay and Mercado Libre were all in the red, even though the indices were up. Not all of them got caught up in the downward spiral just because of Amazon. Some also have problems showing the other facets of the waning internet boom. Facebook shares, for example, plummeted after the social media group announced that the growth of advertisements on the platform had slowed. Like Google or Apple, Facebook also benefited massively during the corona pandemic from the fact that advertisers wanted to reach people on the Internet and increased their spending for it. Here, too, the trend could be broken.
Regardless of this, online trading has established itself at a high level. It cannot be ruled out that the boom will be rekindled in autumn. Stock prices will tell.