Shares of GameStop (GME) gained 134% to close at $347.51. Last Wednesday, the stock closed at $39.12.
This morning, shares were soaring at one point in premarket trading, topping $500.GameStop shares put financial pressure on the hedge funds that previously shorted the stock.
GameStop Corp. (GME) NYSE – Nasdaq shares then declined 40% and were halted several times after brokers place restrictions on trades. Robin Hood at Interactive Brokers also restricted trades. It all took place after a trading frenzy fueled by a Reddit message board by retail investors.
Other stocks that were shorted were Nokia, and Bed, Bath and Beyond. Robinhood explained the move in a blog post Thursday morning, before the open, “In light of recent volatility, we are restricting transactions for certain securities to position closing only, including $AMC, $BB, $BBBY, $EXPR, $GME, $KOSS, $NAKD and $NOK.”
AMC flew up as high as 300% on Wednesday rallying over 450%. In that trading session, more than 1 billion shares changed hands in AMC stock, marking its highest volume day ever.
WallStreetBets Reddit chat room retail investors pushed shares higher and squeezed out short-selling hedge funds. The Reddit forum, which now has more than 4 million members, briefly went private Wednesday night as the moderators said they were “unable to ensure Reddit’s content policy.”
Reddit co-founder Alexis Ohanian called the retail investor-driven trading frenzy in GameStop a “seminal moment” for the finance industry.
CNBC reported-The Securities and Exchanges Commission, which oversees the stock markets, told The New York Times it’s watching “internet chat rooms for signs of potential market manipulation.”
Barron’s reported GameStop disclosed in a filing with regulators on Thursday that MUST Asset Management, a large shareholder in the company, has sold its entire stake in the company.The South Korean asset manager’s sale comes after the stock surged 788% through Wednesday, powered higher by swarms of individual investors targeting the videogame retailer’s heavily shorted shares.
Nancy Pelosi today commented that Congress will look into this issue.