Amazon.com Inc. has been one of the standout performers of the current market environment, and the rally has returned the e-commerce company to all-time highs.
The advance in the stock comes in stark contrast to the overall U.S. equity market, which has struggled in the face of the coronavirus pandemic. While the S&P 500 is in negative territory for the year, Amazon has climbed nearly 20% over the same period, making it one of the 10 biggest percentage gainers among S&P components. The gains have also lifted Amazon back above the threshold of a $1 trillion market capitalization.
Shares (AMZN) rose 1.8% on Tuesday, taking it past a record hit earlier this year.
Amazon has benefited in the current environment as the pandemic forces store closures, amplifying e-commerce demand. Earlier this week, Amazon said it would hire an additional 75,000 workers to meet the spike in demand. The company already filled 100,000 previously announced temporary and full-time positions.
In addition to rising e-commerce demand, the company’s Amazon Web Services cloud-computing business is also expected to see higher demand in the current environment, as the pandemic forces more people to work remotely.
Amazon is expected to report first-quarter results later this month.
Meanwhile, Amazon.com was ordered by a French court to temporarily sell only essential food, hygiene and health items after being attacked by labor unions for failing to protect staff from the Covid-19 pandemic.
The world’s biggest online retailer was given 24 hours to comply with the ruling by the court in Nanterre, close to Paris, or risk symbolic fines of 1 million euros ($1.1 million) for each day’s delay.
Amazon “evidently failed to comply with obligations to protect the health of employees,” judges said in their Tuesday ruling. The court also said the retail platform should carry out a more thorough evaluation of the coronavirus risks in its warehouses.
Amazon will be allowed to return to a “normal” activity once its has properly evaluated the risks linked to Covid-19 with staff representatives and put in place appropriate safety measures, the Nanterre court said.
The company’s representatives declined to immediately comment.
Even if Amazon was to challenge the ruling, the French court ruling sent a signal that authorities are paying a close attention to workers health security. French unions echoed concerns in Spain and the U.S. where employees also said the company has not been responsive to safety concerns and demanded facilities to be closed, sanitized and to adjust stricter health security requirements.
In France, where a handful of workers have been tested and the result turned positive, pressure came from both labor unions and the government. Labor minister Muriel Penicaud demanded late last month an improvement to the working environment for the firm’s employees, saying that “protection conditions are insufficient.”
A request for an urgent ruling was lodged by a labor union last week asking to ban Amazon from continuing to employ staff on its six French sites or, alternatively, reduce the company’s activity to essential goods.
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