The U.S. stock market has been on a roller coaster ride this year. After most of the major indices posted record highs late last year, the market has plunged, then partially recovered.
Among the triggers for these fluctuations are interest rates, inflation, and a faltering economy. Rates were below 2% over much of the last decade. For loans, which include mortgages, the number has approached 5% more recently. Inflation has reached its highest point in four decades. The monthly Consumer Price Index rose just above 9% in June compared to the same month last year.
Perhaps the largest challenge to the markets has been, and is, a recession. GDP dropped in the last two quarters. Economists debate whether the U.S. is in a recession today, or on the cusp of one.
Inflation erodes corporate margins. It also threatens to raise unemployment which cuts consumer demand. And, rising prices make consumers lower spending overall, whether they are employed or not.
Among the industries that had the highest price increases has been tech. The largest companies in the sector have stocks which have tripled in price in the last five years. However, as people started to question the high value of equities, some of these stocks have posted 50% fall offs in just the last seven months.
Market volume by company has also been weighted toward the popular tech industry.
Among the stocks with the highest average trading volume per day are Apple, Amazon, Nvidia, and SNAP. However, the shares that have the highest daily volume are those of Advanced Micro Devices (AMD), America’s second largest chip maker. Recently, its average daily volume has topped 100 million shares a day.
AMD has long trailed the leader in sales and market cap, Intel’s. However, AMD’s sales have grown much faster than Intel’s in the last two years. Recently, it topped Intel in market cap. Both stocks have fallen in the last year, but AMD is off just over 10% and Intel’s shares are down by over a third.
AMD is not well known outside the tech industry. However, it has been one of the better performing companies based on its financials. This, in turn, has drawn tremendous investor interest.
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