Amazon breaks above the $3,000 level and extends rally

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FAANG: Is the tech rally over?

As Americans return from the Fourth of July long weekend, they are back with their famous worldwide optimism and belief in the American dream. A proper proof is today’s market rally, and above all, Amazon shares.

Wall Street is trading in risk-on mode at full steam. The Dow Jones is gaining 1.28 percent or 330 points on the day. The S&P 500 is moving 1.39 percent or 43.51 points positive on the session, and the NASDAQ Composite is the hero today, with a 2.20 percent or 224.88 points advance on Monday.

By sectors, Communication Services and Information Technology are performing the best so far on the session, higher by 1.61 percent and 1.15 percent, respectively.

But two companies are shining among the others, Netflix and Amazon. Let’s talk about the American multinational technology company based in Seattle and its latest achievements.

Amazon, long live the King!

 

Amazon shares - AMZN daily chart July 6

Shares of Amazon are trading sharply higher on Monday amid risk-on sentiment following recent economic news and reopening plans. The new normality is becoming accepted by the market, and Amazon is among the best positioned companies in the current situation.

On Monday, AMZN broke above the $3,000 psychological level and it jumped to a fresh all-time high at $3,030. Currently, it is trading at $3,002.92, which is 3.86 percent on the day.

At this point, let’s talk about something that is crushing my mind lately.

What is happening in the market sentiment is interesting. While COVID-19 cases are pulling up and the United States is becoming the focus of the pandemic again, the market seems to be overseeing the situation and just going their own way.

No matter what the news says, it is time to buy! Why?

An accepted new normal

The COVID-19 pandemic failed to stop the market’s rally because investors realized what a new normality means. In the United States, President Trump is reluctant to close the country’s economy again. So, governors in critical states.

Investors think that countries will not be closed again, and they should adjust to the new normality. Economies opened with social distancing behaviors in mind and online commerce on fire.

In that framework, Amazon is becoming the standard for different business verticals such as deliveries, retail sales, and now computing services.

Amazon Web Services is building up its position as a dominant name in the cloud-computing industry. In addition, the latest fundamental indicators for the company are showing that the trend is becoming even more robust.

Besides, Prime Video is gaining more subscribers just because they are an Amazon subscription related service. Free for all Amazon Prime members.

As analysts at Zack’s highlighted in their blog, “the company has an estimated long-term earnings growth rate of 24.5 percent. The Zacks Consensus Estimate for current-year earnings has improved by 0.4 percent over the past seven days. The stock has climbed 55.8 percent year to date.”

As summary, Amazon is trading at all-time highs on Monday as investors are trading in full risk-on mode. But in the end, it is because the new normal is everything for which Amazon has been getting ready.

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