(Bloomberg) — Retail traders returned in force on Monday, creating a volatile session for de-SPAC firms like Getty Images Holdings Inc.. as well as meme stock favorites including GameStop Corp.
(Bloomberg) — Retail traders returned in force on Monday, creating a volatile session for de-SPAC firms like Getty Images Holdings Inc.. as well as meme stock favorites including GameStop Corp.
Shares of Getty Images, which went public earlier this year after merging with a blank-check firm, climbed 35% — their biggest one-day jump since July. GameStop had a similar rollercoaster ride after it spiked as much as 24% before ultimately paring nearly its entire gain to close up 0.5%.
The rapid rallies triggered volatility-related trading halts for both stocks earlier Monday. Meanwhile, the broader S&P 500 Index ended down 0.7% and the Nasdaq 100 Index closed lower by 1.2%.
“We’re heading into a seasonally strong period for the stock market,” said Keith Lerner, chief market strategist at Truist Advisory Services Inc. “This may just be the way of some investors trying to trade that.”
A basket of so-called meme stocks tracked by Bloomberg rose by about 1%, while the De-SPAC index ended higher for a second straight day, adding 1.6%. Both gauges have plunged this year as concerns about a possible US recession diminished investor demand for shares of riskier assets.
The sudden resurgence in interest for the group comes ahead of what is likely to be a bumpy two weeks for the stock market. A Federal Reserve rate decision on Wednesday will kick off a span of seven trading sessions that will feature four major events including a key jobs report, mid-term elections and inflation data for October.
Other stocks popular with retail traders also saw brief surges on Monday. Bed Bath & Beyond Inc. and AMC Entertainment, two stocks synonymous with the meme stock movement, both gained at least 9.5% at one point. Shares of Rumble Inc., a Peter Thiel-backed conservative video network which went public last month in a SPAC merger with CF Acquisition Corp. VI, jumped 5.5%.
“Stocks that can move up that much in one day on no news can move down just as quickly,” Lerner added. “That’s the warning flag for investors.”
(Updates with closing prices throughout.)
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