Why Advanced Micro Devices Fell Hard on Tuesday

Advanced Micro Devices (NASDAQ: AMD) fell hard on Tuesday, down about 7% as of this writing, much greater than the overall market's decline today. There was no material news out of the company on Tuesday, so the problem likely had to do with macroeconomic factors.

On the one hand, recent sanctions on Russia will prevent advanced semiconductor sales to the country -- but that was announced on Monday. Compounding the uncertainty is spiking oil prices, which some fear may lead to an economic slowdown. Finally, the Federal Reserve is expected to hike interest rates this month, which could hurt high-multiple growth stocks like AMD.

After the invasion, the U.S. Department of Commerce's Bureau of Industry and Security issued a ban on semiconductor sales to Russia. While that sounds dire, investors shouldn't necessarily fret. Russia only accounts for only around 2% of global PC and mobile phone shipments, along with about 1% of server shipments. One concern would be if the situation were to escalate with regard to China, which is attempting to maintain a neutral stance between the U.S. and its Communist ally. However, that escalation hasn't happened yet.

Source Fool.com