Amazon Shares Hit Hard: Trump’s Tariff Bombshell Sparks Market Meltdown
Amidst a market meltdown Thursday, Amazon and other e-commerce stocks plummeted following President Donald Trump’s announcement of plans to impose tariffs on the majority of imports. Trump also intends to remove a tariff exemption on small imports that have benefited Temu and Shein, two Chinese e-commerce sites.
Global investors have expressed unease due to the magnitude of Trump’s proposed tariffs. Although he urged investors to see the tariffs as the beginning of a negotiation, Dan Ives, a typically bullish Wedbush tech stock analyst, described the tariffs as an economic Armageddon in a client note late Wednesday.
Tariffs Threaten Amazon’s E-Commerce Empire: How Bad Could It Get?
According to MarketPlace Pulse research, China-based sellers hold over 50% of the market on Amazon‘s third-party seller marketplace. Justin Post, an analyst at BofA Securities, wrote last month that tariffs are sector-negative for e-commerce, and Wall Street has been discussing in recent weeks just how much Amazon could be hurt by higher tariffs.
Platforms with large third-party selections, such as Amazon or eBay (EBAY), can allow for better substitution and/or for consumers to self-select cheaper items.
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Higher prices might be a tailwind, he continued, because marketplace operators like Amazon, eBay, and Etsy continue to receive fees on the total value of third-party purchases.
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