Retail investors show signs of fatigue after last year's trading frenzy - report

Vinco Ventures

19/01/2022 14:09

Jan 19 (Reuters) - Retail investors were less enthusiastic
about buying the dip in U.S. stocks on Tuesday, the latest sign
of a possible fatigue after last year's tech-fueled trading
frenzy, Vanda Research analysts said in a weekly note.
    Individual investors bought $1.6 billion in stocks on
Tuesday when U.S. shares sold off sharply after weak results
from Goldman Sachs  GS.N  and a spike in U.S. bond yields.
    By contrast, they had bought close to $2 billion on Sept. 28
when the S&P 500 fell 2%.  urn:newsml:reuters.com:*:nL4N2QV37P
    "Retail investors bought a lot less than they typically
would," Vanda's Ben Onatibia and Giacomo Pierantoni said about
Tuesday's session.
    "This could be the first sign that retail fatigue or
capitulation is setting in, at least in the tech space."
    Vanda's research note comes as enthusiasm around so-called
"meme stocks" also appears to be fading, a year on from the
GameStop Corp  GME.N  frenzy when retail investors coordinated 
on online message boards to buy into heavily shorted stocks.
    A report on Friday showed young investors were losing
interest in these "meme stocks", with Gen Z's attention shifting
to companies in areas like electric vehicles and the
"metaverse".  urn:newsml:reuters.com:*:nL1N2TT2VN
    A large share of purchases on Tuesday was concentrated in
ProShares UltraPro QQQ  TQQQ.O , a leveraged ETF that targets
three times the one-day return on the Nasdaq 100 Index  .NDX ,
helping cushion the blow from the massive institutional selling
in the sector, Vanda's analysts said.
    Even Microsoft Corp's  MSFT.O  bumper $68.7 billion purchase
of "Call of Duty" maker Activision Blizzard  ATVI.O , the
biggest gaming industry deal in history, failed to cheer up
retail investors.  urn:newsml:reuters.com:*:nL4N2TY36A
    Retail investors were net sellers of Activision on a day
when its shares jumped 26%, the research house said.
    Buying in retail favorites, including Tesla Inc  TSLA.O ,
Apple Inc  AAPL.O , Advanced Micro Devices Inc  AMD.O  and
Nvidia Corp  NVDA.O , has also diminished amid a tech sell-off
that started last month, according to Vanda Research.

 (Reporting by Medha Singh in Bengaluru; Editing by Saumyadeb
Chakrabarty)
 ((Medha.Singh@thomsonreuters.com; within U.S. +1646 223 8780,
outside U.S. +91 80 6182 2802; Twitter: https://twitter.com/medhasinghs;))