Short covering from institutional investors may have boosted the recent surge, according to some on Wall Street. saw double-digit rallies at one point as investors braced for volatility. Heavily-shorted stocks like Wayfair Inc., Rent the Runway Inc., and those that went public via blank-check merger including 23andMe Holding Co. The stock posted an eye-popping surge of more than 32,000% at one point before erasing a chunk of gains. ![]() The rapid rise and subsequent fall for AMTD Digital Inc. “After AMTD Digital reminded the WallStreetBets crowd of the potential skyrocketing moves, many retail traders are scanning their favorite plays and are looking to get back in.” “These meme stock rallies that are emerging will only last if US stocks broadly continue to head higher,” said Ed Moya, senior market strategist at Oanda. Read more: Tiny IPO Spikes 2,325% During US Debut in Wake of AMTD Digital Newly-public Magic Empire Global Ltd., a little-known Hong Kong-based financial services firm, extended a 2,825% two-day surge since going public, attracting some retail attention. Among the group’s top performers were GameStop and Express Inc. Both company tickers, along with GameStop Corp., were the most mentioned on Reddit’s WallStreetBets platform.Ī basket of meme stocks tracked by Bloomberg rose 3.7%, extending a six-day rally of its own. AMC Entertainment was among the five most purchased stocks on the platform and saw trading volume triple what’s been normal over the past month. ![]() ![]() “The lack of real understanding of why a sudden resurrection of the meme-entum bid could lead to some nefarious speculation about things being manipulated but what would be as much sour grapes speculation as anything real.”īed Bath & Beyond’s taking of the meme stock baton resulted in a 40% rally Monday as a record 120.5 million shares changed hands with the stock being the second-most bought asset on Fidelity’s platform. The “smart guys” are “confused, baffled and fighting short positions from a position of weakness in terms of momentum and firepower,” said Mark Taylor, a sales trader at Mirabaud Securities. A rally in tech shares and other growth stocks at one point on Monday pushed the Nasdaq 100 Index up 20% from a June low amid alarms from some on Wall Street that the Federal Reserve is set on fighting inflation regardless of the pain for the stock market. The resurgence of more speculative areas of the market is likely fueled in part by individual traders willingness to jump on riskier trades and bet against hedge funds.
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