U.S. equities retreated at the tail end of a big earnings week as investors worried about slowing growth at the megacap technology companies that have helped drive the market to record highs during the pandemic. Amazon.com Inc. dropped 7.6% in its biggest decline since May 2020, contributing the most to declines in the Nasdaq 100 and S&P 500 indexes, after the company’s sales outlook missed expectations. Tech stocks including Microsoft Corp. also weighed down the Dow Jones Industrial Average. European equities dropped from a record and Asian stocks slid amid China’s regulatory clampdown.

Amazon announced weaker-than-expected quarterly earnings late on Thursday, and the tech giant’s stock fell 5% as the pandemic continues to weigh on the little guys the hardest.

What Does This Mean?

Amazon’s ecommerce business has done seriously well from the rise of stay-at-home shopping, but that momentum was only ever going to stumble when stores reopened. And right on cue, the segment’s revenue only grew 16% last quarter compared to the same period in 2020 – a significant slowdown from the 44% of the quarter before. On the plus side, at least the working-from-home trend is still going strong despite the loosening of restrictions. That suits Amazon’s cloud computing segment – whose sales grew by a better-than-expected 37% last quarter – just fine.

Why Should I Care?

For markets: If it’s not one thing, it’s another.
In-flux lockdown restrictions are having the most significant impact on Amazon’s share price right now, but something else entirely could be driving its stock before too long. Speculation is rife that Amazon will start accepting bitcoin as a payment method as soon as next year. And if it does, its stock price might start to correlate with the OG crypto’s price – just like it did with Tesla’s.

Zooming out: Is Robinhood a steal?
The arrival of a big-hitter like Amazon onto the crypto market could also drive up trading volumes, which would be good news for commission-free trading apps like Robinhood. And it could certainly do with some: the company made its stock market debut on Thursday at $38 a share – the low end of what it had hoped for. That “only” valued the entire company at $33 billion, and its shareholders – many of whom were customers – were disappointed: Robinhood’s stock fell 8% on its first day of trading.