Investors in big technology stocks have a serious case of whiplash.
on Friday notched the largest-ever one-day gain in market value for a U.S. company—just a day after Facebook parent
Meta Platforms Inc.
suffered the largest-ever loss.
The dramatic moves suggest investors are moving quickly to draw distinctions among the growth prospects of some of the biggest U.S. companies as they reassess their valuations in anticipation of higher interest rates.
Both stocks have surged so far, so fast in recent years that any big move can rattle the broader market and set various records. Amazon is the fourth-biggest company in the U.S. by market value, behind
with a market capitalization of about $1.6 trillion, while Meta is No. 7, even after Thursday’s declines.
In recent days, investors have shown more faith in the tech companies whose services are seen as staples than in those whose offerings are more elective, said
chief investment officer at Comerica Wealth Management, which manages $175 billion.
“Within tech we’re starting to see a delineation between necessities and wants,” he said. “In a rising rate environment, you’re going to have noncorrelated moves in the market.”
Amazon relieved investors with a near doubling in profit in the holiday period and said it is raising the price of its Prime membership in the U.S. to $139 a year from $119. The results showed Amazon was able to control labor and supply costs better than had been expected. The company also saw growth in its cloud-computing and advertising businesses.
“The big thing was more of a sigh of relief with Amazon because there’s been so many worries in regards to that stock in terms of the comparisons after the pandemic being much more difficult,” said
senior portfolio manager at Synovus Trust Co.
Shares surged 14% Friday, their biggest one-day jump in almost seven years. The added $191 billion to Amazon’s market value, eclipsing the record
set just last week when it added $181 billion after posting quarterly results that shattered previous records.
Amazon’s rally helped the broader market stabilize Friday, as did a stronger-than-expected monthly jobs report. The S&P 500 added 0.5%, and the tech-focused Nasdaq Composite rose 1.6%.
Meta, meanwhile, warned it expects revenue growth to slow because users are spending less time on more lucrative services. The 26% drop in its shares Thursday erased $232 billion in market…
Read More: Amazon Breaks Record for One-Day Gain in Market Cap