Amazon (AMZN) Shares Plunge 4.43% as EU AWS Probe and AI Spending Fears Weigh

Amazon.com Inc. (AMZN) shares fell 4.43% in pre-market trading on Nov. 19, 2025, as regulatory scrutiny and investor concerns over AI spending weighed on sentiment. The decline follows a European Commission probe into Amazon Web Services' (AWS) potential gatekeeper status under the Digital Markets Act (DMA). Regulators are assessing whether AWS and Microsoft Azure—despite not meeting size thresholds—wield undue influence in cloud hosting and storage. The investigation, expected to conclude with a public report in 18 months, could force AWS to adjust practices if deemed a gatekeeper.

Amazon also issued $15 billion in bonds Monday, marking its first such move since 2022. The debt issuance, part of a broader trend among tech firms funding AI infrastructure, intensified investor wariness about capital outlays for generative AI. Analysts at Rothschild & Co Redburn downgraded Amazon to "neutral," arguing AI projects require six times more capital than traditional cloud services, risking value destruction.

However, not all analysts shared the bearish view. Needham maintained a "buy" rating, citing Amazon’s track record in managing large-scale infrastructure projects efficiently. Despite this, shares dropped below the 50-day moving average for the first time since October, signaling technical weakness.

The stock’s sharp pullback reflects a tug-of-war between regulatory risks and AI optimism. While the DMA probe highlights structural challenges in cloud computing, Amazon’s bond sale underscores the sector’s capital-intensive nature.

Backtest assumptions suggest a strategy targeting AMZN’s short-term volatility could involve a 20-day RSI divergence trade. A long position might be triggered if the stock rebounds above the 50-day SMA without breaking the $220 support level, with a stop-loss at $215 to manage downside risk. This approach aligns with historical patterns where Amazon’s earnings-driven rallies outperformed broader tech sector corrections.