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GameStop Stock: What’s Been Moving GME Stock Lately, Plus Upcoming Catalysts

Wall Street Memes gathered info on some of the main factors that have been moving GameStop stock in recent weeks. Plus, we outline some potential catalysts ahead.

GameStop stock  (GME) - Get GameStop Corp. Class A Report has been the focus of many major Reddit trading forums in recent weeks. A sudden surge in GME’s popularity on these forums – prompted in large part by the company’s announcement that it would be delving into the NFT space – helped the stock rise over 30% during pre-market on January 7. GME shares started the official trading session up 21%

However, the stock quickly lost steam – it plummeted 24% the next day and is currently trading 3% lower than it was five days ago.

Here, we list some of the main factors that have been driving GME stock's performance lately, plus we look into possible short-term catalysts.

Figure 1: One of GameStop shops.

Figure 1: One of GameStop shops.

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Broad market forces

Although GameStop stock trades very little based on fundamentals, macroeconomic issues tend to impact the broader economy, which is relevant even to GameStop stockholders.

Recent statements coming from the Fed, in which Jerome Powell commented that inflation is heading much higher than the bank’s long-term target, have left the markets wary about rising U.S. interest rates.

An increase in yields tends to hurt companies with higher growth profiles, often impacting projections of financial results. Higher rates can make investments in more aggressive stocks much less enticing.

The news that Nancy Pelosi might be serving her last term before retiring as House Speaker may also be impacting stock investors and traders. Political disruption in D.C. could be seen as a headwind for the passing of legislation that could support the equity markets.

Chair Ryan Cohen’s mind games tweets

GameStop's largest shareholder and current Chair of the Board, Ryan Cohen, is also known as “Papa Cohen” by the GME shareholders community due to his involvement with the "ape" cause and his advocacy for fair trading activities (many GME “apes” assert that there are significant trading irregularities surrounding the stock).

Many shareholders hope that Mr. Cohen, coming off a fantastic growth success story at Chewy, his former company, will use his influence as Chair of the Board to jumpstart new projects and push GameStop's business past its former focus on brick-and-mortar stores.

A few days ago, the Wall Street Journal reported that GameStop has been gearing up to enter the NFT space. The retailer is said to have hired over 20 people to run a business around non-fungible tokens, which would include the development of a marketplace service. The launch of this platform could happen later in 2022.

Mr. Cohen has an "Elon Musk style” to his tweets; he sporadically releases implied messages, which fuels excitement among GME stockholders about the possible mysterious meanings behind certain symbols.

Robinhood's lawsuit lost on meme stock restriction

Meanwhile, things have not been going well for Robinhood  (HOOD) - Get Robinhood Markets, Inc. Class A Report, a company seen by some as a sort of nemesis to the meme stock community.

For the first time, Robinhood has been ordered to pay nearly $30,000.00 in compensatory damages to a retail investor. That investor filed a complaint in May of last year about having suffered significant losses due to Robinhood's decision to restrict trading on certain “meme” stocks during January 2021.

The responsible law firm, Iorio Altamirano LLP, said that the cash award is significant and provides an example of how retail investors can take Robinhood to task.

Should this be the first of many lawsuits won by retail investors related to Robinhood's meme-stock trading restrictions of January 2021, Robinhood could be headed for a lot of pain.

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(Disclaimers: this is not investment advice. The author may be long one or more stocks mentioned in this report. Also, the article may contain affiliate links. These partnerships do not influence editorial content. Thanks for supporting the Wall Street Memes)