The worsening trade conflict between China and the US is crushing tech stocks around the globe -- a major blow for e-commerce giant Amazon (AMZN) that just lost more than $120 billion in total market cap in less than two weeks.
Amazon stocks plunged almost 4% in pre-market trade on Monday and are seen to fall deeper in their eighth-consecutive loss in the coming days. This would be the Cloud-computing firm's longest retreat since 2006. Amazon has shed more than 12% in this losing streak.
The heavy hammer on its head fell in the midst of a triple-threat of dismal profits, regulatory issues, and the wider stock market sell-off that has befuddled the tech company's valuation.
The company's stocks have dropped $248.18, or 13.1% in the current streak. With around 495 million shares outstanding as of mid-July, the sell-off has cost Amazon some $122.78 billion in market capitalization.
Amazon's losing streak started on the day before the company posted 2nd-quarter sales that beat Wall Street's estimates. During this streak, Amazon has had to deal with anti-trust lawmakers probing into the so-called "Big Tech", and issues on market valuation as the escalating China-US trade discord discourage investors.
The Nasdaq Composite tumbled 3.8% Monday, notching its sixth-consecutive losing session, its longest since a 9-day drop in late October 2016, just before President Donald Trump sworn into office as president.
Apple's stock was also down 5%. The tech giant generates 18% of its total revenue from China. Many big-name chipmakers that have a major presence in China, like Intel, AMD, Qualcomm, Nvidia, and Broadcom, also suffered significantly.
Amazon Founder and Chief Executive Officer Jeff Bezos made a wise decision by selling stocks last week. In a filing with the Securities and Exchange Commission, Bezos said he unloaded 968,149 shares at $1,899.10, for a total value of $1.85 billion. These same figures would now be valued at only $1.71 billion.
In a related development, Mike Binger of Gradient Investments says investors should not be discouraged and purchase Amazon stocks despite the company's losing streak since 13 years ago. "These tech firms are relatively immune from the tariff announcement," he disclosed on CNBC's "Trading Nation." He added that he has no issues with the buy ratings that Wall Street "assigned to those companies, they have been strong performers and not immune to pullbacks."
