Investing.com – Gamestop and AMC prices rose in premarket trading on Tuesday as gains in so-called meme stocks translated into evening deals after a key figure in their 2021 rally reappeared after a lengthy hiatus from social media.
GameStop Corp. (NYSE:) and AMC Entertainment Holdings Inc (NYSE:) outperformed their peers, rising about 100% each after rising 74% and 80%, respectively, on Monday.
Other shares such as US shares BlackBerry Ltd (NYSE:) and headphone maker Koss Corporation (NASDAQ:) rose more than 10% each. Reddit Inc (NYSE:), which sparked much of the meme stock frenzy on its Wallstreetbets forum, rose 2%, as did Robinhood Markets Inc (NASDAQ:), whose retail volumes have skyrocketed due to this craze.
The rise in share prices had nothing to do with the companies’ fundamentals and came after Keith Gill, known on social media as RoaringKitty and DeepF***ingvalue, posted a series of cryptic images and GIFs on the social media platform. X. These were Gill’s first posts in nearly three years that didn’t mention Gamestop.
Gill’s posts included clips from films such as Pirates of the Caribbean, Tombstone, V for Vendetta, and a comic strip about a man sitting in a chair playing video games. The image, which was the first of Gill’s new posts, is used to convey the message that things are getting serious.
Gill’s posts on Reddit, particularly about his investment in Gamestop and the huge number of short positions in the stock, triggered a wave of retail buying of Gamestop.
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The buying then spread to other stocks with relatively weak fundamentals and high short positions. This, in turn, gave rise to the idea of meme stocks—stocks that move primarily based on sentiment on social media rather than the company’s actual fundamentals.
But despite Monday’s gains, shares of Gamestop, AMC and other meme companies remained well below their 2021 peaks. Gamestop was trading at around $36 per share, a fraction of the $120 it reached at the start of 2021.