Amazon.com Inc. Hits $2 Trillion Milestone Amid AI Boom and Interest Rate Cut Hopes

(Reuters) – For the first time, Amazon.com Inc. has achieved a staggering $2 trillion market value. This milestone makes Amazon the fifth U.S. company to reach such heights, fueled by growing excitement around artificial intelligence and the anticipation of interest rate cuts this year. This surge in demand for tech stocks reflects the market’s optimism and the evolving landscape of the tech industry.

Amazon’s stock surged by 3.4% to $192.70, pushing its market value past $2 trillion. This achievement places Amazon alongside tech giants like Microsoft, Apple, Nvidia, and Alphabet in the exclusive $2 trillion club.

U.S. stock indexes have surged this year, driven by strong excitement around AI advancements, confidence in the U.S. economy’s resilience, and hopes for potential interest rate cuts from the Federal Reserve.

Wall Street is buzzing with activity, nearing record highs, thanks to powerhouse stocks like Nvidia and Amazon. These tech giants are expected to see a boost in future profits due to anticipated lower interest rates.

Amazon shares, added to the prestigious Dow Jones Industrial Average in February, have surged more than 26% this year. In February, Amazon also became the fifth-largest U.S. company by market value, following Nvidia’s rise.

Amazon Web Services, the world’s top cloud services provider, has bounced back from last year’s dip. The surge in AI technology adoption has fueled this renewed growth at Amazon’s cloud division.

Amazon’s $2 trillion valuation reflects its strategic investments in AI, including backing startups like Anthropic and robotics companies like Figure, as it seeks to ride the AI wave.

Late last year, Amazon introduced a new generation of custom-designed chips for their data centers, focusing on enhancing machine-learning training and generative AI applications.