- Shares of GameStop and AMC Entertainment experienced a significant drop on Wednesday, following a two-day rally sparked by the return of Keith Gill, also known as ‘Roaring Kitty’.
- Gill, a central figure in the 2021 meme stock frenzy, had a significant influence on the surge of these stocks through his social media posts and YouTube streams.
- Despite the recent tumble, both GameStop and AMC were among the top 10 securities bought by retail investors on Tuesday.
GameStop and AMC Entertainment stocks tumble after a short-lived rally, highlighting the volatile nature of meme stocks and the influence of social media on retail investors.
GameStop and AMC Stocks Take a Hit
After a two-day rally, shares of GameStop and AMC Entertainment took a significant hit on Wednesday. The rally was largely attributed to the return of Keith Gill, also known as ‘Roaring Kitty’, who was a central figure in the 2021 meme stock frenzy. GameStop shed nearly 30 per cent of its gains from the past two sessions, while AMC fell 25 per cent after surging 135 per cent in the same period.
The Influence of ‘Roaring Kitty’
Keith Gill’s influence on the stock market has been significant. In 2021, his YouTube streams and posts on Reddit helped attract a flood of retail cash into GameStop. On Tuesday, he shared a clip from the movie ‘Braveheart’ on X (formerly Twitter) with the word ‘GameStop’ flashing on the screen, marking his first company mention after a three-year gap from the platform.
AMC’s Debt Exchange and Trading Halt
In an exchange filing, AMC announced it will issue nearly 23.3 million shares of its stock to exchange for $163.9 million in debt that it owes. Following the market opening, trading in these retail investor darlings was halted multiple times, with investors exchanging more than $2.3 billion worth of GameStop shares.
Conclusion
The recent tumble of GameStop and AMC stocks highlights the volatile nature of meme stocks, which are often subject to sudden surges and drops due to the influence of social media and retail investors. Despite the fall, both stocks were among the top 10 securities bought by retail investors on Tuesday, indicating continued interest in these companies.
