Amazon Stock Soars on Smartphone Rumor

By Ray Lee, Epoch Times

To draw interest for Amazon’s upcoming launch event on June 18, CEO Jeff Bezos released Wednesday a Youtube teaser on a mysterious new product. Many speculate that the product in question is a glasses-free 3D smartphone.

In the teaser, potential customers were seen interacting with the device by moving their heads back and forth or tilting the device. The actual device is never displayed in the video. The Twitter photo for the event is just as nondescript, showing only a thin device with the Amazon logo.

Erik Sherman from CBS Money Watch warns that, despite the buzz, it will be difficult for Amazon to break into the smartphone market because most phones sell through cellular carriers. These carriers may or may not buy into the new product even if customer demand is high.

The market seems to believe that this new device has the potential to be a game changer. On Thursday, when the overall market was up 0.65 percent (SPY), Amazon stock price shot up a whopping 5.47 percent (AMZN). The stock continues to climb today, up roughly 2 percent with the overall market up 0.5 percent.

However, buyers beware, come the launch event on June 18, this could be a classic case of “buy the rumor, sell the news”. Many investors will bid up the stock in anticipation of the launch event and then immediately dump their stock after.

RECOMMENDED