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GameStop shares tried to bounce back Wednesday from a massive losing streak that’s taken some steam out of the retailer’s Reddit-fueled rally.
The video-game chain’s stock price climbed as much as 26 percent to $113.40 in early trading but pared the gains to 3 percent about two hours after the opening bell. The choppy moves
followed a premarket trading session that saw the stock move in and out of the red.
GameStop’s shares lost more than 70 percent of their value Monday and Tuesday, pulling the rug out from under an unprecedented surge in “meme stocks” fueled by a retail trader uprising on
Reddit’s WallStreetBets forum.
The buying comes as investors on the message board vow to remain steadfast in their devotion to GameStop — and to beating hedge funds that bet against the stock — despite claims of hefty
losses.
“Everyone left at this point are true soldiers, with MASSIVE diamond hands,” a user named astroxlogical wrote on WallStreetBets late Tuesday, using a slang term for dedication to a financial
bet. “I’m not worried about the losses these past couple days, because I know what’s going to come if we stay strong.”
“The year is 2022. [GameStop] prices are approaching $2. The new [WallStreetBets] subs still insist tomorrow the spike is coming,” user ROYBUSCLEMSON wrote early Wednesday.
Reddit’s foul-mouthed band of day traders has won support from high-profile figures such as billionaire entrepreneur Mark Cuban, felon penny stockbroker Jordan Belfort and Reddit co-founder
Alexis Ohanian.
But they’ve also drawn the attention of regulators. Treasury Secretary Janet Yellen plans to discuss the wild market activity at a meeting this week with the heads of the nation’s top
financial watchdogs, including the Securities and Exchange Commission, the Federal Reserve, the Federal Reserve Bank of New York and the Commodity Futures Trading Commission.
GameStop shares likely got a boost from the company’s Wednesday appointment of three new executives, including chief technology officer Matt Francis, who will join from Amazon Web Services
on Feb. 15.
Overshadowing GameStop’s rebound efforts, however, is the Robinhood investment app, which imposed restrictions on Reddit’s favorite stocks last week amid massive price swings.
GameStop and cinema chain AMC Entertainment were the only stocks that remained subject to limits on the number of shares and options contracts that Robinhood users could buy Wednesday
morning. The discount brokerage, which had to raise $3 billion in a matter of days to support the buying, also resumed allowing users to buy fractional shares — pieces of stock that are less
than a full share — in those companies.
AMC was recently up about 6.4 percent at $8.32 after plunging 41 percent on Tuesday. Other stocks popular among retail traders also saw modest gains — former smartphone maker BlackBerry rose
roughly 0.3 percent while telecom giant Nokia climbed about 1.1 percent.