Amazon Smashes $3 Trillion Market Cap as AI-Fueled Growth Continues

Amazon's market capitalization surged past $3 trillion on August 3 as investors celebrated the company's strong Q2 earnings. The tech giant's cloud revenue grew by 37% year-over-year, driven in part by its AI-driven initiatives.

The rapid ascent has pushed Amazon's relative strength index (RSI) into overbought territory, signaling a potential near-term selloff. Nevertheless, Morgan Stanley's senior analyst Brian Nowak remains bullish on the stock, maintaining an Overweight rating and raising his price target to $335, indicating potential upside of nearly 18% from current levels.

The derivatives market also suggests a bullish sentiment, with a put-to-call ratio set at 0.31x, signaling a skew towards buying options contracts. The upper price on those contracts currently sits at $311, indicating potential for another 9% rally within the next three months.