GameStop Corp (NYSE:GME) and other meme stocks such as AMC Entertainment Holdings (NYSE:AMC) and Bed Bath & Beyond Inc. (NASDAQ:BBBY) rallied overnight in another rally that had market old timers shaking their heads, with the gang all on track for more gains at Friday's opening bell.
Despite a no trigger from any fundamental reasons, the old favourites from Reddit's WallStreetBets community all rose sharply, as did many cryptocurrencies.
GameStop shot up 20% at one point and market trading had to be paused more than once due to the volatility.
It finished 10% higher, while AMC closed up 8% and BBBY, while spiking almost 13% at one point, ended the session up 2%.
The wildest ride was seen at Beyond Meat Inc (NASDAQ:BYND), another WSB darling, which veered from a 20% decline to a 11% gain before finishing down 4%.
The quartet are all 4-5% higher in Friday's pre-market trading.
Cryptos were also bouncing back, with bitcoin breaking back above the psychological US$30,000 level, while Ethereum also enjoyed strong gains.
“It’s not just crypto making a comeback. So-called ‘meme stocks’ have had a surge in light of the current market volatility for no fundamental reason," said Victoria Scholar, analyst at Interactive Investor.
“After the initial enthusiasm, these Reddit-favourites pared gains into the close and are still nursing heavy year-to-date losses. The move higher in these stocks could have been exacerbated by a short squeeze, which is when short sellers are forced to buy the stock back in order to avoid painful losses on their short positions when the market rallies.
“The meme stock jump highlights the erratic price action that markets are struggling with at the moment, with sharp volatility across equities, little directional certainty, and outsized moves in riskier assets like cryptos, meme stocks and tech companies.”