Markets are in a good mood again after Amazon beat the analysts’ expectations with the release of its second-quarter results. The stock surged close to 10 percent after the earnings release.
The online giant is seen as a major bellwether for the global economy as online spending explodes. This has been especially the case during the COVID-19 period when online buying was essential at the time.
With the COVID-19 situation becoming somewhat under control in Europe and the Americas the recent second-quarter results beat the top line and upbeat guidance for the third quarter bode well for the e-economy.
The company posted revenues of $121.23 billion vs. $119.09 billion expected and had an EPS loss of 20 cents. The revenue growth of 7% in the second quarter topped estimates
Amazon Web Services, a major income stream came in at $19.7 billion vs. $19.56, while advertising came in at $8.76 billion vs. $8.65 billion expected, according to StreetAccount.
Amazon said in its second-quarter release that it expects to post third-quarter revenue between $125 billion and $130 billion, representing growth of 13% to 17%.
The company also noted, “Despite continued inflationary pressures in fuel, energy, and transportation costs, we’re making progress on the more controllable costs we referenced last quarter, particularly improving the productivity of our fulfillment network”.
Tech stocks are higher on the news, with the Nasdaq set for its best trading week of the year so far. The S&P500 and DJIA are also set to finish the week and month with impressive gains.
The situation with the economic releases is that bad news is good news and the recent downbeat Q2 GDP release from the US economy could temper the FED from raising rates too fast.
Impressive moves in the foreign exchange market from the British pound and the Australian dollar against the US dollar further highlight the situation with risk-on currency trades.
Gold looks set for its best trading week since the start of the year, while silver is also above $20.00 and close to posting a four percent price gain on the week. Copper is also rallying alongside the other precious metals towards $350.00.
