GameStop suspended: Stock halted repeatedly after share surge

Oliver O'Connell
·2 min read
 (AP)
(AP)

Shares in retailer GameStop surged again on Thursday possibly heralding a further rally for stocks heavily-shorted by Wall Street, but favoured by amateur traders.

Trading had to be halted shortly after the opening bell in New York, and several times after that, with shares trading up approximately 50 per cent.

Investors had already pushed up the price by 104 per cent on Wednesday before trading was halted.

It is not certain what caused the surge, but most point to the reported exit of chief financial officer Jim Bell.

Mr Bell will resign on 26 March according to a company announcement, potentially signalling that the company could move in a different direction.

There have been calls for the brick-and-mortar retailer to move to a digital model to distribute video games and other related products.

There was heightened interest on Wednesday at reports that Ryan Cohen, co-founder of online pet food retailer Chewy, and an activist investor in GameStop, joined the company’s board in pressuring Mr Bell’s move to get on with the transition.

Trading in GameStop shares first made headlines in January after amateur investors piled into the company that had been shorted by Wall Street firms, driving the stock price up to $438.

After traders on platforms such as Robinhood were barred from purchasing further shares the value of the company plummetted again.

What has changed since then is that it now appears that trading decisions by investors are being based on more traditional movements by the company, rather than activism or other motives.

On Wednesday the share price jumped from $52.41 at 3pm to $97.1 at close.

When the market opened on Thursday the price jumped to $170, before falling back to just under $120 and beginning a steadier climb to approximately $132 by 11.30am.

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