With Trading Limited, GameStop Drops Sharply

Wall Street recovers from last week's losses
By Newser Editors and Wire Services
Posted Feb 1, 2021 3:43 PM CST
With Restrictions in Place, GameStop Sinks 30%
A man walks past the New York Stock Exchange during a snowstorm, Monday, Feb. 1, 2021, in New York.   (AP Photo/Mark Lennihan)

Stocks closed higher on Wall Street Monday, recovering some of the ground they lost last week in their biggest weekly drop since October. Investors large and small continued to focus on GameStop and other stocks targeted by online traders hoping to inflict damage on hedge funds, the AP reports. The S&P 500 index rose 1.6%, or 59.62 points, to 3,773.86. The Dow Jones Industrial Average rose 229.29 points, or 0.76%, to 30,211.91, and the tech-heavy Nasdaq jumped 332.70 points, or 2.55%, to 13.403.39. Shares of GameStop were down 30.8%, in what has become a typical move for a company that has regularly seen double-digit swings most of the last two weeks. Trading of the retailer was still limited on trading platforms like Robinhood.

"Definitely having easy access to information, encouragement on social media and a very easy trading experience has gotten more people involved," said Sunitha Thomas, national portfolio advisor at Northern Trust Wealth Management. "All of that combined is going to lead to more volatility as investors with a shorter outlook are a bigger part of the daily trading volume." After last week's chaos and steep losses for hedge funds, Robinhood and other trading apps have restricted trading in GameStop and numerous other shares targeted by Reddit users, including AMC Entertainment, BlackBerry, Koss, and Express, CNBC reports. Many of those stocks saw large drops on Monday, though AMC closed up 0.3%. (Silver, another target of online traders, rose to an eight-year high Monday.)

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