GME and AMC Stocks Resurge as Memestock Rally Regains Momentum

GME and AMC Stocks Resurge as Memestock Rally Regains Momentum

GameStop stock and AMC shares experienced a significant surge following the return of Keith Gill to social media after a three-year absence. Gill, who played a pivotal role in igniting the meme stock rally during the pandemic, reemerged online, causing a stir in the market. The New York Stock Exchange took notice of the frenzied trading activity, temporarily halting trading on GME stock multiple times in the early hours of Monday as share prices skyrocketed.

Gill, also known by his social media alias Roaring Kitty, made a notable return to the online scene on Sunday night, marking his first post on the social media platform X since June 2021. The post featured an image of a meme suggesting that he's "getting serious."

Gill gained widespread attention in 2020 and 2021 for his significant role in the GameStop (GME) short squeeze. As a former financial broker and analyst, he became a central figure in the saga and was eventually summoned to testify before the House Financial Services Committee in February 2021 as part of an investigation into potential market manipulation.

Following Gill's return, retail investors expressed their excitement with comments like "he's back" and "game on." Some even humorously remarked, "just in time for the memecoin supercycle," alluding to the recent surge in prices of smaller cryptocurrencies.

GME stock experienced a remarkable surge of approximately 74.5%, prompting the New York Stock Exchange (NYSE) to briefly pause trading multiple times within the first hour due to heightened volatility.

GameStop Shares Show Minimal Movement Throughout the Year

Throughout the year, GameStop shares remained relatively unchanged, closing at $17.46 on Friday.

AMC Entertainment (AMC) Witnesses 78.4% Rally on Monday

Similarly, theater chain AMC Entertainment (AMC) witnessed a significant rally of 78.4% on Monday. However, this surge follows a substantial decline of nearly 53% in 2024, with shares currently hovering just above their record low of $2.38 from April.

In 2021, GME stock witnessed an extraordinary surge of 688%. This surge was fueled by individual investors who orchestrated a coordinated buying frenzy through online message boards, catching short sellers off guard. These short sellers, who had bet on the stock's decline, faced significant losses unless they covered their positions by purchasing the stock, thereby amplifying the upward momentum.

This unconventional method of driving up GME stock proved to be both innovative and contentious.

Ironically, GME stock rose as a result of its significant decline, contrary to the expectations of many investors who anticipated further drops.

Prior to 2021, GME shares had experienced a 33% decline over the preceding five years. Short sellers had gained control of GME stock shares in late 2019, setting the stage for a monumental short-squeeze rally due to their excessively bearish positions.

The entire saga of the short squeeze was vividly portrayed in the movie "Dumb Money."