GameStop Corp on Thursday plummeted, snapping a dizzying six-day rally and wiping out nearly US$11 billion in market value after brokers choked off demand for the stock by curbing trading on the apps used by the firm’s zealous fan base.
On Thursday, the stock plunged 44 percent after Robinhood Markets, Interactive Brokers Group Inc and others took steps to curtail activity in several high-flying stocks, including GameStop and AMC Entertainment Holdings Inc.
E*Trade Financial Corp is preventing customers from purchasing shares of both firms, a person familiar with the matter said.
Photo:Reuters
GameStop shares on Thursday jumped during extended trading, after Robinhood said that it would allow limited buying of certain securities yesterday.
“We’re beginning to open up trading for some of these securities in a responsible manner,” the firm said in a statement.
GameStop rose 46 percent in post-market trading, while AMC climbed 29 percent.
The video game retailer triggered 19 volatility halts on its way to shedding more than twice what it was worth on Monday.
Volume also fell, with about 55 million shares traded by Thursday afternoon, a far cry from its record of 197 million on Friday last week.
The trading curbs resulted in howls of outrage on Reddit’s WallStreetBets forum, which has been the launching point for many of this week’s blistering rallies.
Robinhood has been hit by lawsuits from customers.
It also prompted lawmakers to criticize restrictions imposed on retail investors.
US Senator Sherrod Brown, incoming chairman of the US Senate Banking Committee, said that he plans to hold a hearing on the “current state of the stock market.”
The clampdown by brokerages extended beyond GameStop to other popular stocks, such as BlackBerry Ltd, that have surged this week, burning short sellers and hedge funds.
The phenomenon attracted the attention of regulators on Wednesday, with the US Securities and Exchange Commission saying that it was monitoring the situation.
“The inability to trade depressed the volume, and high volume is what kept the stock trading at a high level,” Wedbush Securities Inc analyst Michael Pachter said. “I’m actually surprised the trading platforms think they can manage the market this way, and expect they will reverse their decision shortly.”
STRONG INTEREST: Analysts have pointed to optimism in TSMC’s growth prospects in the artificial intelligence era as the cause of the rising number of shareholders The number of people holding shares of chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) hit a new high last week despite a decline in its stock price, the Taiwan Depository and Clearing Corp (TDCC, 台灣集保) said. The number of TSMC shareholders rose to 2.46 million as of Friday, up 75,536 from a week earlier, TDCC data showed. The stock price fell 1.34 percent during the same week to close at NT$1,840 (US$57.55). The decline in TSMC’s share price resulted from volatility in global tech stocks, driven by rising international crude oil prices as the war against Iran continues. Dealers said
Taiwan’s natural gas supply remains stable through the end of May, despite rising concerns about potential disruptions to Qatari liquefied natural gas (LNG) supplies due to escalating conflicts in the Middle East, the Ministry of Economic Affairs said yesterday. The ministry in a statement said that Taiwan has completed preparations for natural gas supply and shipping schedules through the end of May. It has also made plans to increase natural gas imports from regions outside the Middle East in June to ensure a stable supply, it added. Taiwan sources natural gas from 14 countries and is not solely dependent on the Middle East,
China is clamping down on fertilizer exports to protect its domestic market, industry sources said, putting an additional strain on global markets that were already grappling with shortages caused by the US-Israeli war on Iran. China is among the largest fertilizer exporters — shipping more than US$13 billion of it last year — and it has a history of controlling exports to keep prices low for farmers. Shipments through the war-blocked Strait of Hormuz account for about one-third of the sea-borne supply. This month, Beijing banned exports of nitrogen-potassium fertilizer blends and certain phosphate varieties, sources said. The ban, which has not
Grab Holdings Ltd agreed to buy Delivery Hero SE’s Foodpanda operations in Taiwan for US$600 million, a deal that marks its first foray outside of its Southeast Asian base. The cash acquisition will allow Grab to expand into 21 cities across Taiwan, the Singapore-based ride-hailing and delivery company said in a statement yesterday. Grab expects the transaction to be completed in the second half, subject to regulatory approvals. The purchase will give Grab a presence on the island of about 23 million people, helping it to expand beyond its intensely competitive home market. Grab has seen growth slow dramatically as it takes
RSS