And Amazon’s holiday season was cut short by a later than usual thank you. It is expected that it will experience relatively lackluster fourth quarter earnings growth.
Wall Street analysts predict that Amazon sales have grown 17% in the last quarter, according to a Refinitiv survey. It would be positive for most companies, but far less than the average 25% growth that Amazon has experienced over the past four years over the holiday quarter.
Earnings growth from Amazon’s huge cloud operation also slowed. The “Meh” earnings for Amazon would bring a bad blow to the company.
Microsoft’s victory (for now, however, pending trial) in achieving the JEDI contract puts the company “in place of the catbird to get more of these complex workloads” in the future, according to Dan Ives, Wedbush Securities analyst .
Meanwhile, bad news continues to pile up for Bezos & Co.
“We predict antitrust rhetoric will reach deafening levels during this presidential election year, while Amazon’s relationship with the White House remains the most precarious within Big Tech,” said Brian White, Internet and software analyst at Moness Crespi Hardt. in a note to investors, week.
Waning optimism on the American job market
But economic growth in the United States is expected to slow in 2020 compared to last year and that slightly weaker forecasts are beginning to meet hiring expectations.
Just over half – 51% – of companies plan to hire new workers this year, according to a recent survey conducted by Challenger, Gray & Christmas, a relocation company. This is down from 55% who said in late 2018 that they would add heads in 2019.
While it’s far from terrible, it’s a sign that companies are less optimistic about the economy this year. Over 18% of the companies surveyed reported that economic fears and weak demand would damage their ability to hire, compared to 9% the previous year.
“We are seeing some indicators, such as slow-growing wages, an increase in job cuts and an exodus of CEOs, which could portend offshore,” said Andrew Challenger, vice president of the company.
Economists remain bullish on the American economy, but the weakness of American factories due to the trade war has proven detrimental to growth.
“It is no exaggeration to say that this is the strongest job market in history, however, economic growth continues to slow down and let’s not forget that production is in recession,” said Chris Rupkey, chief financial economist at MUFG.
Somewhere, Elizabeth Warren is smiling
Thursday was a good day for supporters of the Wall Street reform.
Bank reform advocates, notably Democratic presidential candidate and US Senator Elizabeth Warren, have long sought punishment for Wells Fargo executives and the bank’s leadership for being more inclusive. Thursday they got a double win.
Come on next
American Express and Ericsson report earnings before US markets open.
Also today: US purchasing manager index data arrives in January, providing new evidence on the health of U.S. manufacturing and services sectors.
Coming next week: The Federal Reserve is expected to remain dormant, but the Bank of England could cut interest rates ahead of the UK’s exit from the European Union.