Negative Press Weighs On Amazon

Amazon Lower Pre-Market

Shares in US tech company Amazon (AMZN) are trading a little lower ahead of the final stock trading session of the week.

The company’s shares have seen very congested price action over recent months with price settling into a ranging formation, framed by a contracting triangle structure since correcting from the September 2020 highs.

While Amazon shares have been grinding steadily higher since November, the company has failed to recapture the upside momentum seen across Q2 last year. Price is now, once again, caught between support at 3103.51 and resistance at the 332.07 level.

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Image Source: Unsplash

Accusations Of Poor Working Practises

This week, there has been a string of negative press around the company. This is likely weighing on sentiment at the end of the week.

Firstly, UK newspaper The Mirror, on the back of an investigation conducted in conjunction with the bureau of investigative journalism, reported that Amazon has been using ‘slave labor” in the UK.

The Mirror reported that Amazon has been hiring workers through agencies offering zero-hour contracts. This is despite their claims that it does not use such practices.

Workers also told of shifts being canceled in the middle of the night or just a few hours ahead of the shift start time. Furthermore, some workers are paid less than advertised.

Amazon Response

Given that Amazon saw its UK sales rocket higher by 51% to $20 billion across the pandemic, the news is particularly troubling. The report also revealed that some Amazon couriers are paid as little as £2 per hour for their work.

Amazon said that it created 20,000 seasonal positions over the Christmas period to deal with record demand and said that it did not use zero-hour contracts or work with agencies that did.

Record Breaking Q4

Q4 saw bumper returns for Amazon globally. The company reported Q4 earnings per share of $14.08, almost double the $7.20 Wall Street was looking for.

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