Mumbai/New York–Stocks of global e-retailers — Amazon and Walmart — remained subdued on Monday, days after India’s new Foreign Direct Investment (FDI) norms for e-commerce companies dented investor sentiments.
In the early morning trade hour (US East Coast), shares of Walmart on the New York Stock Exchange (NYSE) opened in the red and remained subdued. Its shares traded 0.19 per cent lower at $93.68. Shares of Amazon on the Nasdaq, however, rose marginally by 0.31 per cent to $1,631.27 per share.
The subdued trade in the two e-tail giants assumes significance as India is viewed as a major market for future growth and expansion for the two companies. Currently, the market has captured the interest of not just American multi-nationals but even those from China.
“The impact will be there for the next few days,” said Deepak Jasani of HDFC Securities. However, analysts feel that both suppliers and consumers will get used to the new policy environment.
On February 1, disruption was caused in the e-commerce operations in India of the two companies after the new FDI norms for the e-commerce sector came into effect. The norm prohibited the online retailers from mandating any company to sell their products exclusively on its platform.
In the new policy, the Commerce Ministry also noted that the online retail firms would not directly or indirectly influence sale price of goods and services and would maintain level playing field.
Amazon India had to withdraw many of its products and they were listed as “currently unavailable” as the new norms prohibit the e-retailers from selling products of companies in which they have stakes.
Both Amazon and Walmart had sought an extension of the deadline for the new norms, but the government rejected and they came into effect on February 1.
Although major stakeholders led by Walmart and Amazon had sought a six-month extension, other players like Snapdeal and offline traders led by the Confederation of All India Traders supported the government’s move.
On Friday, shares of Amazon on the Nasdaq stock exchange fell 5.38 per cent to $1,626.23 per share, while the stock price of Walmart on the New York Stock Exchange (NYSE) ended 2.06 per cent lower at $93.86.
The two companies together lost market capitalisation of $50 billion. Amazon lost market capitalisation of over $45 billion on Nasdaq, while Walmart lost over $5 billion on the NYSE.
The market cap of Amazon was at $798.81 billion at the end of Friday’s trade and that of Walmart at $272.69 billion. (IANS)
