Proactive Investors - GameStop Corp (NYSE:GME)’s latest meme stock frenzy-fuelled rally saw the retailer enter the top 500 companies by market capitalization in the US on Tuesday.
Having more than doubled as trading got underway on Tuesday, shares in GameStop soared as high as US$64.83 early on.
This gave the brick-and-mortar retailer a market cap of almost US$19.8 billion as of the morning, based on its shares in issue as of late last year, granting it a spot as the US’ 392nd largest company.
Shares receded from highs into the afternoon to sit up 55.4% at US$47.40, leaving GameStop’s market cap at US$14.5 billion and at number 485 on the list.
Commenting on the rise, which marks a 439-spot gain for the day, Finalto analyst Neil Wilson noted: “This is wild.”
On the seemingly now set return of the meme stock craze, he said: “I didn’t think we’d see this again but retail clients are buzzing.”
The latest craze had been prompted by the return of Roaring Kitty to social media through a string of posts appearing to tease another rampage against Wall Street short sellers.
Shares in AMC Entertainment Holdings (NYSE:AMC) soared too, by 35.7%, alongside a host of heavily shorted stocks such as BlackBerry (TSX:BB) Inc and Beyond Meat Inc (NASDAQ:BYND).
Highlighting the ensuing blame game on the back of the latest craze, which has seen traders build hype for such ‘meme stocks’ on social media in a similar fashion to in 2021, Wilson added fingers had been pointed at the Federal Reserve.
“It shows markets working really inefficiently,” he noted, “people hate that”.
“If retail is in this mood a lot can happen but it probably does mean that the Fed pivoted too soon - the reacceleration in inflation is testament to that.”