GameStop, AMC surge 100% in premarket trade as meme stock rally pushes higher
2024.05.14 07:29
Investing.com– Gamestop and AMC rose in premarket trade on Tuesday as a rally in so-called meme stocks spilled over into evening deals, after a key figure in their 2021 rally re emerged from an extended break on social media.
GameStop Corp (NYSE:) and AMC Entertainment Holdings Inc (NYSE:) were the best performers among their peers, rising about 100% each after rallying 74% and 80%, respectively, on Monday.
Other stocks such as the U.S. shares of BlackBerry Ltd (NYSE:) and headphone maker Koss Corporation (NASDAQ:) rose more than 10% each. Reddit Inc (NYSE:), which had fostered a bulk of the meme stock frenzy on its Wallstreetbets forum, rose 2%, as did Robinhood Markets Inc (NASDAQ:), which had seen bumper retail trading volumes from the craze.
The gains in stock prices had little to do with the fundamentals of the companies, and came after Keith Gill, who goes by the social media monikers RoaringKitty and DeepF***ingvalue, posted a series of cryptic images and gifs on the social media platform X. They were Gill’s first posts in nearly three years, and did not mention Gamestop.
Gill’s posts included clips from movies including Pirates of the Caribbean, Tombstone, V For Vendetta, and a comic of a man playing video games sitting up in a chair. The image, which was the first of Gill’s new posts, is used to convey the message that things are getting serious.
Gill’s posts on Reddit, particularly on his investing in Gamestop and the overwhelming amount of short positions against the stock, had spurred a flurry of retail buying into Gamestop.
Buying had then spilled over into other stocks with relatively weak fundamentals and high short positions. This had in turn spawned the idea of meme stocks- shares which move largely based on social media sentiment, rather than the actual fundamentals of the company.
But despite Monday’s gains, Gamestop, AMC and the other meme stocks remained well below peaks hit during 2021. Gamestop was trading at about $36 a share- a fraction of the $120 hit in early-2021.
