What’s Happening to AMD?
Advanced Micro Devices, Inc. (NASDAQ:AMD) was down by about six percent on Thursday, a departure from what otherwise has been a stellar year for computer chip-makers.
AMD stock has had a fantastic 2016, up 192% since the beginning of the year. There hasn’t been much in the way of bad news surrounding AMD stock. On the contrary, the most recent information on Advanced Micro Devices is about the company’s success. Which raises the question: why has AMD stock, and the tech industry as a whole, been falling on Thursday?
While there hasn’t been a single cause reported that’s hurting AMD, the NASDAQ in general has been having a rough day. With other tech giants like Facebook Inc (NASDAQ:FB) and Microsoft Corporation (NASDAQ:MSFT) also taking hits—albeit smaller ones at three and two percent each—this might be a response of the market to the NASDAQ 100’s relative perceived weakness.
While the Dow Jones Industrial Average (DJIA) and the S&P 500 Index both had very strong Novembers, the comparatively muted numbers of the NASDAQ 100 might be signalling to investors that a shift toward industries away from tech is taking place.
Remember, in this post-Donald Trump world, there’s been much discussion as to whether tech stocks will be hurt by a new White House administration. The early results were inconclusive but, as time goes on, we’ll be able to better gauge what a Trump presidency will mean for tech stocks.
But, back to the present.
With some investors looking at other sectors as perhaps more lucrative than the currently dominant tech industry, this could help explain how otherwise very well-performing stocks have been seeing a drop in Thursday’s market.
AMD is not in total free fall by any means. There’s still a number of reasons to be excited about the stock. For instance, the company has created a buzz surrounding it’s new “Zen” CPU, what PC Gamer called “one of the biggest CPU launches in recent history, and perhaps ever.” Zen is set to be announced on December 13. (Source: “AMD to announce Zen on December 13,” PC Gamer, November 30, 2016.)
Either way, it’s good to keep an eye on AMD stock to see if Thursday is indicative of a future trend or an aberration in an otherwise great 2016.
Editor’s Note: Hi, Stephen Karmazyn here. If you enjoyed this article, you can get more of my opinions and commentaries in our popular daily tech letter, Profit Confidential. Published daily, it’s FREE! .