GameStop shares JUMP 20% in a day but remain far below their peak after punishing week of selloffs
- GameStop stock jumped 19.6 percent to $63.77 at the closing bell on Friday
- It was still far below the high of $483 it reached last week
- Robinhood’s move Friday to lift trading restrictions may have spurred the rally
Shares of GameStop rose again on Friday, following a punishing week of selloffs that took the stock well off the highs it reached in a small-investor frenzy last week.
GameStop stock jumped 19.6 percent to $63.77 at the closing bell on Friday. That’s far below the high of $483 it reached last week but still well above the $17 it traded at in early January.
Friday’s rally in GameStop may have been spurred by Robinhood’s move Friday to lift all the restrictions the online trading platform had placed last week on trading in the stock, as well as shares of a few other companies that were hyped on social media and internet forums.
Users of the Reddit forum WallStreetBets, who have become devoted to the stock, cheered Robinhood’s move and predicted it would boost GameStop.
Shares of GameStop rose again on Friday, following a punishing week of sell-offs that took the stock well off the highs it reached in a small-investor frenzy last week
GameStop stock jumped 19.6 percent to $63.77 at the closing bell on Friday
‘Boys this is it. This is the time to rebound and beat those sons of b***hes. Now that we can trade we can buy and that’s how we win by buying,’ one WallStreetBets user wrote. ‘The more we buy the more we drive up the price and make money.’
‘Now is the time to strike back,’ wrote another. ‘Brokerages have rescinded the restrictions. Today and the days after the weekend will probably show where this is going.’
Robinhood, among the fee-free online brokers that are credited with fueling the ‘meme stock’ frenzy, said late on Thursday it had removed all buying restrictions that it had imposed after struggling to meet clearing house deposit requirements last week.
With many of the stocks involved in the so-called ‘Reddit rally’ slumping this week, hedge funds with bearish positions on GameStop made $3.6 billion in profits compared to losses of $12.5 billion in January, financial analytics firm Ortex said on Friday.
GameStop stock price is seen in a one-year view, showing the shares spiking and falling
‘The speculation is now fading but that doesn’t mean it can’t come back a month or two months from now,’ said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.
‘A lot of the small investors may have gotten burnt, so it’s going to take time to heal that wound. It may not pop up in those stocks that were already attacked, but it could happen in other companies and maybe on a broader scale.’
U.S. Treasury Secretary Janet Yellen met with top officials to discuss the volatility on Thursday and sources told Reuters the securities regulator was looking at all aspects of the rally and all parties involved.
Meanwhile, on WallStreetBets on Reddit, participants were still urging investors to stick with GameStop.
‘GME YOLO/FOMO my second mortgage. 35k to 5mil to 300k. I WILL NOT SELL!,’ read one post by a participant with the handle u/Rhollow1.