GameStop Corp (GME) - Get Report shares surged higher Friday, with AMC Entertainment (AMC) - Get Report following suit, after online trading app Robinhood removed buying restrictions from all stocks on its platform.
GameStop shares were halted at least three times in the opening hour of trading, perhaps fueled by data from Ortex suggesting short-sellers had made $3.6 billion in profits on bets against the video game retailer this week. S3 Partners said short interest in the group stands at $1.36 billion, or 25.4 million shares.
Previous curbs on adding to existing positions, either via share or options purchases, triggered sharp declines for many of the so-called meme stocks this week, including GameStop, which is down nearly 90% from the all-time high of $483.00 a share in reached last week's Reddit-fueled retail trading frenzy.
The losses were extended yesterday as Treasury Secretary Janet Yellen met with market regulators and Federal Reserve officials in Washington after telling ABC's Good Morning America program that "we need to understand deeply what happened before we go to action, but certainly we’re looking carefully at these events.”
A statement issued following the meeting said "regulators believe the core infrastructure was resilient during high volatility and heavy trading volume."
GameStop shares, which had slumped to a January 22 low of $53.33 each yesterday, were marked 32% higher in early trading Friday to change hands at $71.00 each.
Once one of the most bet-against stocks in the market, with a short interest reportedly at 140% of the outstanding float, GameStop surged to as high as $483 per share amid an unprecedented frenzy of retail investor interest fueled in part by discussions inside the r/Wallstreetbets chatroom on Reddit.
The moves ignited similarly-meteoric rises in what became known as 'meme stocks', including Bed Bath & Beyond (BBBY) - Get Report and Blackberry (BB) - Get Report, while lifting the key benchmark of equity volatility to the highest levels in nearly a year while tagging several hedge funds with collective losses of more than $20 billion.