GameStop shares jump after Robinhood lifts curbs
It’s “game on” again for some day traders. Shares of GameStop and other social media-hyped stocks jumped on Friday after online broker Robinhood lifted all buying curbs it put up at the height of the trading frenzy.
Shares of videogame retailer GameStop skyrocketed more than 50% in early trading Friday. Headphone maker Koss zoomed up by more than a fourth, and cinema operator AMC Entertainment rose 14%. But the wild gyrations seen in the past two weeks appear to have fizzled out.
Robinhood is the commission-free broker popular among the young that’s credited with fueling the trading frenzy of heavily shorted stocks favored in a Reddit chat room. Last week, the trading platform imposed restrictions on those stocks due to a surge in clearing house deposit requirements. As a result, GameStop’s stock that had peaked at $483 last week nose-dived to about $53 a share by Thursday. But it’s still nearly triple what it was at the start of the rally. Robinhood said late Thursday it had removed all buying restrictions.
Earlier this week, Fiduciary Trust chief investment officer Hans Olsen said the retail revolution - that pits the small guy versus the powerful hedge funds that bet against these stocks - may have legs.
“There isn’t any reason why this couldn’t tumble around as additional stimulus checks get written and the like. And you know, people feel empowered by this.”
On WallStreetBets on Reddit, participants urged investors to stick with GameStop. One wrote, “I WILL NOT SELL!”
On Thursday, Treasury Secretary Janet Yellen met with top officials to discuss the market’s wild swings. Sources told Reuters the Securities and Exchange Commission was looking at all aspects of the rally and all parties involved.
