GameStop Corp.’s rally fizzled further Tuesday, meaning the stock has now given up almost 80% of the spectacular gains that were fueled by last month’s attack on short sellers from Reddit day traders.
The stock tumbled to $104 at 9:44 a.m. in New York, after triggering its first volatility pause of the day. The video-game retailer’s market value has dwindled by $26 billion to $7.4 billion from a Thursday intraday peak, though the stock is still up almost 500% year-to-date.
GameStop’s retreat has coincided with a sharp reduction in short interest after bearish investors appeared to cover their positions. That has loosened a squeeze on the stock caused by day traders who used Reddit forums to tout and bid up out-of-favor stocks that also included movie-theater chain AMC Entertainment Holdings Inc. and American Airlines Group Inc.
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app instead?
By Davide Scigliuzzo and Katherine Doherty, Bloomberg
1 Feb 2021 07:31
Image: Tiffany Hagler-Geard/Bloomberg
Itâs the kind of rescue that the most indebted companies in America can only dream of: a fresh injection of cash that doesnât hurt their already depressed stock price or load even more costly debt onto their balance sheet.
Yet thanks to the army of day traders who use Reddit to tout and bid up out-of-favour stocks and squeeze short sellers, firms such as American Airlines Group Inc. and AMC Entertainment Holdings have found themselves on the receiving end of just such a lifeline.
Here are five stocks that have the potential to move when the economy opens back up:
1. Indoor Dining:
Dine Brands Global Inc (NYSE:DIN) operates franchised and corporate-owned Applebee s Neighborhood Grill & Bar and International House of Pancakes restaurants. Many states closed or restricted indoor dining when COVID-19 case rates rose. The shares are trading more than 28% below Dine Brands Global s February 2020 highs.
2. Travel: Although
American Airlines Group Inc. (NASDAQ:AAL) share prices have been declining for years, it is trading in a range not seen since 2012.
Travel has been heavily restricted in the U.S. and internationally since last March, and once the economy reopens customers are sure to want to book trips.
The Reddit Army Bailout: Desperate Companies Get New Lifelines
Bloomberg 1/31/2021 Davide Scigliuzzo and Katherine Doherty
(Bloomberg) It’s the kind of rescue that the most indebted companies in America can only dream of: a fresh injection of cash that doesn’t hurt their already depressed stock price or load even more costly debt onto their balance sheet.
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Yet thanks to the army of day traders who use Reddit to tout and bid up out-of-favor stocks and squeeze short sellers, firms such as American Airlines Group Inc. and AMC Entertainment Holdings Inc. have found themselves on the receiving end of just such a lifeline.
Robinhood CEO denies conspiracy theory claims that hedge funds pressured him to halt GameStop trading and lock out Reddit traders as he insists he made right decision
Robinhood CEO Vlad Tenev on Friday called claims that hedge funds prompted his company to halt trading on GameStop a conspiracy theory Our decision to temporarily restrict customers from buying certain securities had nothing to do with a market maker or a market participant, Tenev said
He claimed no one put pressure on the company or asked them to halt trading It was entirely about market dynamics and clearinghouse deposit requirements, as per regulation, he added