Home / Business and Economy / AMD Slips as AI Chip Giant TSMC Sparks Sector Sell-off
AMD Slips as AI Chip Giant TSMC Sparks Sector Sell-off
17 Jul
Summary
- Taiwan Semiconductor's forecast fueled a broad semiconductor stock pullback.
- Advanced Micro Devices shares declined despite a constructive technical picture.
- Analysts remain bullish on AMD, citing strong AI growth and upcoming earnings.
Broader market sentiment soured, with futures for the Nasdaq and S&P 500 indicating a weaker opening. This came after Taiwan Semiconductor reported strong second-quarter financial results and boosted its capital expenditure projections.
While the outlook reinforced sustained demand for artificial intelligence chips, investors seemed wary of the scale of anticipated future spending. This concern led to widespread profit-taking among semiconductor stocks.
Advanced Micro Devices, which has seen remarkable gains over the past year, was notably affected. Investors reduced their exposure to high-growth technology stocks.
Despite Thursday's decline, AMD's stock remains above key long-term moving averages. It currently sits above its 50-day, 100-day, and 200-day simple moving averages. However, it has dipped below its 20-day moving average, suggesting a cooling of near-term momentum.
The stock's relative strength index is at 51.74, indicating neutral momentum. Key resistance is identified around $546.50, with support near $498.00.
AMD designs a range of chips for various applications, including a significant expansion into AI accelerators. This has been a primary driver of its stock's performance.
The company's next earnings report is slated for August 4. Analysts project earnings per share of $1.55 on revenue of $11.28 billion.
Wall Street sentiment towards AMD remains largely positive, with a consensus 'Buy' rating and an average price target of $521.47. Several analysts have recently raised their price forecasts, some significantly.
