Amazon and Microsoft Shares Jump 6% on Cloud Regulation Outlook

Shares of Amazon and Microsoft rose over 6% on Wednesday despite Democratic election wins that could lead to stricter AI data center regulations. Amazon led gains with a 7% jump to $271.49, while Microsoft, Alphabet, and Meta also advanced. Analysts said tighter regulatory barriers would favor established cloud providers, which already own data centers and computing capacity, by raising costs for smaller entrants like CoreWeave. A slowdown in sector capital spending could also ease financial pressure on incumbents. The Democratic victory, including governor races in Texas, Georgia, and Ohio, followed a campaign focused on opposition to rapid AI data center expansion. Investors remain concerned about sustainability of tech giants' AI infrastructure spending, which has driven negative free cash flow at several companies.