As Market Falls Intel (INTC) Shares Rout AMD’s (AMD)
August 6, 2007 by Douglas A. McIntyreA falling market often demonstrates how the rich get richer and the poor… get nothing.
Much of the last month, AMD’s (AMD) shares have out-performed Intel’s (INTC). Just over a week ago, AMD’s stock was up almost 10% since early June, and Intel was slightly down. The market was cheered by AMD’s revenue growth in the last quarter, and a modest increase in its gross margins.
But, the threat of a tougher economic market in the form of a falling market turned those tables. Last week, AMD shares dropped over 8% compared to an increase of nearly 2% at AMD.
The movements suggest that in the market psychology a stock can get some benefit of the doubt when the overall trend of the indices are up. Hope begets hope. But, traders punish weak companies in a down market probably on the belief that only the best of times can foster a recovery at firms that have been vulnerable.
That leaves AMD is a bad position.
Douglas A. McIntyre
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