RiverNorthPhotography/iStockBy CATHERINE THORBECKE, ABC News
(NEW YORK) — GameStop shares surged nearly 40% early Thursday, after doubling in price on Wednesday, in a new rally that once again has many market watchers scratching their heads.
The new spike in GameStop stock comes weeks after its meteoric rise and fall in late January as individual investors on the Reddit forum r/wallstreetbets pushed shares for the struggling video game retailer to new heights, forcing hedge funds shorting the stock to close their positions at major losses.
Trading of GameStop stock was temporarily halted multiple times Thursday morning as the wild trading session kicked off.
The r/wallstreetbets forum exploded with memes and posts touting GameStop stock once again Wednesday afternoon and Thursday morning.
Many linked the initial surge Wednesday to a cryptic tweet of an ice cream cone from Ryan Cohen, one of the largest shareholders in GameStop through his firm RC Ventures.
Cohen, who founded the e-commerce platform Chewy, was appointed as a member of GameStop’s board of directors in early January, just prior to when members of r/wallstreetbets began evangelizing GameStop stock.
GameStop stock was relatively flat Wednesday morning, until Cohen — who is not particularly active on Twitter — tweeted the photo of an ice cream cone at 2 p.m. ET. In the hours after his tweet, shares surged more than 85%, jumping from $49.46 a share to a closing price of $91.70 on Wednesday.
On Thursday morning, moderators of the r/wallstreetbets forum tweeted “Good Morning Everyone,” using special characters to emphasize the letters “GME,” the ticker for GameStop stock.
🇬ood
🇲orning
🇪veryone— wallstreetbets (@wsbmod) February 25, 2021
The initial GameStop saga in late January, which is already being turned into a Hollywood movie, drew the attention of lawmakers and prompted a House hearing last week.
The House Financial Services Committee summoned some of the key players in the drama to the hearing, including Robinhood CEO Vlad Tenev and Reddit user Keith Gill (also known by his screen names “RoaringKitty” and “DeepF—ingValue”).
The hearing mostly centered on the decision of Robinhood to abruptly restrict some transactions for GameStop during the height of the volatility.
At the hearing, Gill — the Reddit user who many say initiated the initial surge — doubled down on his position for the stock, saying he remains “bullish.”
Copyright © 2021, ABC Audio. All rights reserved.