The shares of GameStop Corp. were on track on Wednesday for their highest closing price in history and their longest winning streak since the video game’s stock became the poster child for Reddit-inspired investment frenzy, but a sudden drop in the stock price and a trading stop clouded the picture around noon.
GameStop GME,
shares traded 5% to 36% above Tuesday’s close during Wednesday’s morning session, including breaking the January 27 to January 27 record of $ 347.51. They were on track for a six-day winning streak, the longest since September 3, 2020, when the stock ended eight days in a row, according to Dow Jones Market Data Group.
That was well before GameStop’s stock became a household name from January, when buy-and-hold investors rallied on Reddit’s WallStreetBets forum against Wall Street companies betting heavily on the stock, making it one of the most short-circuited shares is out there. Recently, an analyst charted a strong correlation between the volume of chatter on WallStreetBets and GameStop’s stock price.
However, prices fell just after noon, losing more than $ 100 a share within minutes and falling below Tuesday’s closing price of $ 246.90. Trading was halted five times between 12:20 PM and 12:50 PM Eastern Time when prices plummeted. Other stocks wrapped up in the Reddit frenzy appeared to be showing similar patterns on a variety of scales on Wednesday: AMC Entertainment Holdings Inc. AMC,
Koss Corp. KOSS,
Blackberry Ltd. BB,
and Nokia Corp. ENOUGH,
NOKIA,
stocks also saw earnings in the morning session suddenly disappear after noon.
By noon, GameStop’s trading volume had surpassed 32 million shares, compared to a 10-day average daily volume of 59.5 million and a 52-week average daily volume of 14.9 million. The company had its highest market cap since January and is currently worth more than $ 23 billion. Last week, GameStop set a cap of $ 10 billion, after a weekly profit of 35%.
Before that, GameStop posted its second-best week ever with a 150% gain, compared to its 400% weekly rally in late January. The top four weekly gains for the stock occurred between a six-week period in 2021, when investors were massively targeting the stock.
GameStop’s fourth quarter results, including Christmas sales, are scheduled for March 23 after markets close. In January, the company released a sneak peek showing that ecommerce sales were up more than 300%, but overall sales were down during the holiday season.
Shares of GameStop are up more than 1,700% this year alone and more than 8,000% in the last 12 months. For comparison: the S&P 500 index SPX,
is up 4% in 2021 and is up 35% in the last 12 months.