Wall Street reverses course, closing lower

The S&P 500 flirted with an all-time high but finished slightly lower Wednesday as institutional investors awaited inflation data.

The Dow shed four-tenths of a percent; the S&P 500 lost 0.2%, and the Nasdaq ended nearly flat.

But there was no stalling among retail traders who busily bid up a new batch of meme stocks. The heavily shorted stocks driven by social media underwent another rotation with Aethlon Medical taking center stage. The medical device maker’s shares catapulted nearly five-fold. World Wrestling Entertainment also got a pop from the Reddit crowd, hopping 11%. So did prison operator GEO Group, jumping over 38%. But Tuesday’s fave, Clover Health, fell by nearly a fourth.

Gerber Kawasaki CEO Ross Gerber sees similarities between meme stocks and the internet stock frenzy of the late 1990s.

“This is a very similar period of time as dot-com, where many companies that don't have the fundamentals to match the valuations are trading like crazy. But for every winner, there's always a loser with these stocks because in the end they're bad companies.”

Shares of Campbell Soup shed nearly 7%. The food maker behind Pepperidge Farm cookies and its namesake soups slashed its annual earnings forecast as it faces higher costs for raw materials and transportation.

Merck shares shot 2% higher. The pharmaceutical company will supply the U.S. government with its experimental oral COVID-19 treatment for about $1.2 billion.

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