Amazon rose more than 4%, with a market value exceeding $2 trillion for the first time in history

On Wednesday, Amazon's stock price surged more than 4% to $194.80 during trading hours, reaching a market value of over $2 trillion for the first time.

Amazon is the latest giant to join the $2 trillion and above market value club. Alphabet, Google's parent company, broke the $2 trillion mark at the end of April, while the market values of Nvidia, Microsoft, and Apple have all exceeded $3 trillion. The continuous breakthrough of market values by major U.S. tech giants highlights the ongoing stock market frenzy brought about by artificial intelligence.

Since the release of its first-quarter financial report this year, Amazon's stock price has been fluctuating. The report showed that its cloud computing division recorded the strongest sales growth in a year, helping its stock price rebound and surpass the historical high set in April. Amazon's stock price has rebounded significantly in June, rising by about 10% so far and recovering the lost ground at the end of May. It has risen by about 27% year-to-date.

Over the past year, as Amazon has cut costs and restructured its business to better leverage the AI trend, its stock price has received a significant boost. In addition, its key Amazon Web Services (AWS) business has shown signs of growth reacceleration, which is a major factor driving investor optimism.

Analysts at Morningstar Investment Services stated that the strong performance of Amazon's stock over the past 6-9 months is partly due to overselling at the end of 2022.

Will launch a discount zone similar to Temu

On the same day, it was reported that Amazon plans to launch a new section on its shopping website dedicated to selling inexpensive goods directly shipped from Chinese warehouses to overseas consumers, in response to the rapid growth of low-cost websites like Temu and Shein.

This new section by Amazon will offer unbranded fashion products, household items, and daily necessities, with orders taking 9 to 11 days to reach customers. Amazon informed Chinese sellers at a recent closed-door meeting that it will start signing up merchants this summer and begin accepting inventory in the fall.

In recent years, Temu and Shein have achieved significant growth among American shoppers by offering ultra-low-priced goods shipped directly from China. This has sparked internal debates at Amazon on how to respond. Amazon has long touted the fast shipping times of its vast U.S. delivery network.

There will be a new section on the Amazon homepage where shoppers can browse inexpensive goods. Sellers joining this section can decide on their product selection and pricing, and can produce in small batches to test the demand for their planned new products. This model is similar to Shein, which allows its suppliers to produce popular items in small batches to minimize unsold inventory Compared to Temu, Amazon seems to take a more relaxed approach to new products. Temu decides what products sellers sell and their prices, and represents sellers in marketing and storefront operations.

It is currently unclear whether Amazon's related shipments will use U.S. trade terms that exempt U.S. tariffs on individual packages valued at less than $800.

An Amazon spokesperson said, "We have been exploring new ways to collaborate with our selling partners to delight our customers with more choices, lower prices, and greater convenience."

Following the release of this news, the stock price of Pinduoduo, Temu's parent company, fell by more than 2%, Etsy's stock price fell by 1%, and Amazon's stock price saw an expanded increase. Pinduoduo's stock price closed down 1.3%, while Etsy's stock price remained roughly flat