Market / Stocks

Amazon jumps as Wall Street bets on a faster cloud

Amazon closed up 4.98 percent at $262.45 after Morgan Stanley named it a top pick and raised its price target to $350. The bank expects AWS growth to reach 47 percent in 2027, and earnings on October 29 are the next test.

New York, United States · October 20, 2026

Amazon had its best kind of Monday. The stock closed up 4.98 percent at $262.45 after Morgan Stanley named it a top pick and raised its price target to $350, up from $335. In a market that has spent two weeks arguing about whether AI spending ever pays back, that is a bank putting its name on the opposite bet.

The bet is mostly about the cloud. Morgan Stanley expects growth at Amazon Web Services to reach 47 percent in 2027 as AI demand builds, a forecast carried in CNBC's reporting and repeated across market coverage the same day. AWS is where Amazon's AI spending turns into other companies' bills, which is exactly the conversion investors have been demanding proof of.

Price targets are opinions with a number attached, and this one still needs the company to cooperate. Amazon reports earnings on October 29, and that print has to show the cloud accelerating rather than just the spending doing so. A target of $350 against a close of $262.45 leaves a lot of room, but room is not the same as a path.

Read the move as a marker in the wider argument, then. The chip rout last week was investors asking who pays for the AI buildout. Amazon's jump is the market answering that the cloud owners with real customers might be the ones who collect. October 29 decides whether that answer survives contact with the accounts.