GameStop’s shares soared again in pre-market trading, jumping 100 per cent by the market’s open on Friday, as under-fire investment app Robinhood partially reversed its decision to restrict trading of its stocks and reportedly secured €1bn from its backers. Despite GameStop’s explosive open, the rest of the market lagged.
The ailing video game retailer found itself at the centre of a battle between small investors self-organised on Reddit, who launched a historic attempt to punish multibillion dollar Wall Street hedge funds looking to short-sell the stocks, igniting a trading frenzy.
Robinhood – which says its “mission is to democratise finance for all” – then decided to block users from buying GameStop shares, which it said was due to “significant market volatility”, prompting a fierce backlash, including from members of the US Congress as politically diverse as Ted Cruz and Alexandria Ocasio-Cortez, who signalled their support for a congressional hearing.
Read more:
- How and why Gamestop shook the stock market
- Reddit users claim victory as $13bn hedge fund closes position, accepting huge losses
- ‘You stand for everything I hate’: Reddit WallStreetBets posts open letter to Wall Street Hedge Funds
- How a fight between Reddit users and Wall Street saw video game company’s stock increase tenfold
