Amazon shares bounce back after drop in wake of fresh Trump attack

Shares are still down overall this week

Already on Wednesday shares in the company slumped close to 5 per cent (Thomson Reuters Eikon)

Shares in Amazon recovered somewhat by the market close on Thursday, having slumped in the wake of an open attack by President Donald Trump over its business practices.

The US president took to Twitter earlier in the day to accuse Amazon of paying “little or no taxes to state and local governments”. He said that he had raised such concerns “long before the [2016] election” and that the e-commerce giant was responsible for “putting many thousands of retailers out of business”.

Already on Wednesday shares in the company slumped close to 5 per cent, shaving more than $30bn (£21.4bn) off its market value, after news website Axios reported that Mr Trump wanted to rein in Amazon’s growing power.

On Thursday morning, Amazon’s shares fell as much as 4.5 per cent in morning trade, but recovered and closed up just over 1 per cent. However, they are still down for the week.

According to the Axios report, the president wants to change Amazon’s tax treatment. Last year he already called for the implementation of an internet tax for online retailers, even though Amazon already collects sales tax on items it sells direct to customers.

Mr Trump has for some time been a vocal critic of Amazon and its chief executive and founder, Jeff Bezos, who currently tops Bloomberg's Billionaire index with an estimated net worth of $120bn.

Mr Bezos also owns the Washington Post, which the president has accused of spreading “fake news” in response to the paper’s critical coverage of his administration.

White House spokesman Raj Shah said in a television interview that Mr Trump's tweets are not about Mr Bezos, but that mom-and-pop shops and brick-and-mortar stores are having trouble competing with fast-growing Amazon.

“Tax policy, and other policy, has to catch up...so those who are competing with Amazon are on a level playing field,” Mr Shah said on Fox News show Fox & Friends. But he also said, “We're not laying out specific policies.”

The White House Deputy Press Secretary, Lindsay Walters, later said that "the president has expressed his concerns with Amazon" and that the administration "have no actions at this time."

Tech stocks more broadly have suffered a severe slide in recent days, partially triggered by the prospect of greater regulation in the wake of Facebook admitting that user data had been improperly harvested by Cambridge Analytica.