Wed, 27 January 2021 | Written By: Neil Wilson
Neil is chief market analyst for Markets.com and also writes for the Investors Chronicle as ‘The Trader’, with the daily market outlook published online each morning.
Something strange is happening on Wall Street
Something strange is happening on Wall Street, or at least to a number of individual stocks, which are getting caught up in a battle between a bunch of Reddit day traders and investors and Wall Street hedge funds. Shares in GameStop (GME) surged another 92% on Tuesday to almost $148, with after-hours trade pointing to shares opening up another 42% higher later today. Other companies’ shares are going through the same weird price action. Shares in AMC Entertainment rose 12% yesterday but shot 66% higher in after-hours trade. BlackBerry, Bed, Bath and Beyond and Nokia are among some of the stocks being bid up.
The GameStop Insurrection Spreads
Everyone knows shares of GameStop are soaring.
But the huge retail investor-driven rally is not confined to the video game shop. Shares of headphone manufacturer Koss, for example, are up 275 percent to an all-time high. Shares of AMC are up 182 percent. Blackberry shares are up 16 percent. Shares of Bed, Bath, & Beyond rose around 30 percent on Wednesday. Shares of Nokia are up 40 percent.
Brokerages are starting to limit leverage for investors in some of these surging stocks. TD Ameritrade told customers on Wednesday that it has placed curbs on some transactions in Gamestop and AMC.
Many of the smaller investors who have organized around the Reddit Group r/wallstreetbets see themselves as engaged in a populist uprising against the Wall Street establishment.
Elon Musk Tweet Sends Etsy Stock on a Roller Coaster Ride
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Photo: Maja Hitij, Getty Images
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Stocks: They’re so random ???? these days.
The bonkers story of a Reddit forum that turned the Gamestop stock into a meme and sent the company’s market value soaring has put a spotlight on the phenomenon of amateur investors giving Wall Street pros a run for their money. A Venn diagram of the types of folks brigading short-sellers on r/wallstreetbets and Elon Musk fans would surely be a circle. And this morning, Musk once again showed the power of his influence when he tweeted the words: “I kinda love Etsy.”