'Meme stock' rally redux? GameStop, AMC shares rocket higher (updated)

KOSS

23/03/2022 20:26

(Updates with closing prices, adds comment from strategist)
    NEW YORK, March 23 (Reuters) - More than a year after retail
investors, aided by social media, forced an epic squeeze of a
handful of heavily shorted stocks, a few of the famous "meme"
stocks were back in the fast lane this week. 
    GameStop Corp  GME.N  surged 14.5% on Wednesday and AMC
Entertainment Holdings  AMC.N  ended the session up 13.6%.
    While GameStop shares were boosted by Chairman Ryan Cohen's
disclosure that his investment company bought 100,000 shares of
the video game retailer, the increase extends the 30% rally on
Tuesday, which had no apparent catalyst.  urn:newsml:reuters.com:*:nL3N2VP4F7
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    GameStop and AMC were the top two most trending stocks on
the retail investor-focused stocktwits.com on Wednesday.
    "This has probably occurred because we’re in a weak market
environment, likely investment managers who short are looking
for opportunities and they’ve gone back to those historically
tried and true names," said Tim Ghriskey, senior portfolio
strategist at Ingalls & Snyder in New York.  
    "That provides an opportunity for these investors to try to
create a short squeeze," Ghriskey added. "It causes a frenzy in
the shorting community and it can close a hedge fund" with
extensive short positions.
    Other companies associated with the trend, also referred to
as "stonks" on social media, like Blackberry  BB.N , Koss Corp
 KOSS.O  and Sundial Growers  SNDL.O , advanced between 1.4% and
4.2%.
    Netherlands-based electric vehicle charging company Allego
NV  ALLG.K   ALLG.N  joined the fray, skyrocketing 114.1%.
    Even with today's rally, GameStop, AMC, Blackberry and Koss
are down between 5% and 24%, year-to-date. 
    This stands in stark contrast to the short-squeeze frenzy of
January 2021, when GameStop and AMC skyrocketed by 1,600% and
750%, respectively, over just a few sessions.
    On Tuesday, short sellers in Tesla Inc  TSLA.O  , GameStop
and AMC lost $2.32 billion, according to S3 Partners.
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 (Reporting by Stephen Culp; Editing by Alden Bentley, Bernard
Orr and David Gregorio)
 ((stephen.culp@thomsonreuters.com; 646-223-6076;))