In September, the US hiring rate surpassed expectations by 81%, with Amazon stock rising by 1.7% due to the positive jobs data. The US Nonfarm Payrolls reached 254K, well above the consensus of 140K, and the Unemployment Rate dropped to 4.1%. This came after the resolution of a dockworker strike with a 62% wage hike over six years. The Dow Jones and NASDAQ also saw positive movement in response to these figures.
Amazon is expected to benefit from the improved labor market as the backlog of imports to its fulfillment network reduces. Despite the dockworkers’ strike ending, talks of automation at ports continue, which could lead to job losses and will be a topic of negotiations in the future. Lower interest rates are also beneficial for growth-oriented companies like Amazon, with the market now expecting smaller rate cuts at the Federal Reserve’s November meeting.
The market had previously anticipated a 50 bps cut but is now predicting a 25 bps cut in November and December, with continued rate cuts throughout 2025 at a slower pace than expected. With the central bank starting its cutting cycle in September, Fed governors favor further cuts over the next 18 months. This positive outlook is likely to benefit stock investors.
In anticipation of the holiday season, Amazon announced plans to hire 250,000 seasonal workers, with many potentially being retained as full or part-time employees into 2025. Last year, Amazon saw a spike in sales during the fourth quarter, with the potential for even higher sales this year. If the growth rate of recent quarters remains consistent, Q4 sales could surpass $190 billion.
After seven consecutive days of decline, Amazon stock could see a turnaround if it maintains gains on Friday. The focus is on whether the stock can surpass resistance levels at $195 and $200. If not, there is support from the 50-day, 100-day, and 20-day Simple Moving Averages between $177 and $183. Overall, Amazon’s positive news regarding hiring, economic data, and stock performance points towards a strong end to 2025.
