The stock market dropped on Thursday, with S&P 500 falling 0.9% to 7,641 and Nasdaq declining 1.0% to 26,067. The sell-off was driven mainly by rising Treasury yields, higher oil prices, and renewed inflation concerns.
Chart of the Day
Here is the one-year chart of Amazon (AMZN) as of August 5, 2026, when the stock was at $273.
Amazon is making massive AI investments, but management says the spending is will generate strong and profitable returns. Management stated its server and networking investments take less than 3 years to breakeven, while the equipment lasts at least 5 to 6 years. This means Amazon can spend the next 2 to 3 years generating strong cash flow after the investment has paid for itself, making the AI spending moving forward very profitable. Also, AI capacity is already contracted for 5 years or more.
Last quarter, Amazon Web Services (AWS) revenue backlog reached $496 billion from $195 billion a year ago, up 154% year-over-year.
Management expects to spend around $220 billion in CapEx in 2026, with most going toward AI and AWS.
Amazon is part of the Growth Portfolio, Focus List, and Conservative Growth Portfolio.
