BackGameStop rebounds from worst week as wild ride starts to fizzle
GameStop Corp. rebounded from its worst week on record as the video-game retailer’s roller-coaster ride continued to lose momentum.
PremiumGameStop Corp. rebounded from its worst week on record as the video-game retailer’s roller-coaster ride continued to lose momentum.
The stock was up 11% at 5:40 a.m. in New York premarket trading, after falling 80% last week, a drop that followed three weeks of dizzying gains.
GameStop has stabilized since Robinhood Markets Inc.'s move late last week to end buying limits it imposed in the wake of the stock’s January surge. Inflated levels of short interest that triggered a squeeze on the shares have declined after a number of hedge funds closed positions and incurred huge losses.
“Extremely elevated short interest is a pre-condition for a major short squeeze to occur," Goldman Sachs Group Inc. strategists wrote in a note dated Feb. 5, saying that GameStop -- on which short interest had exceeded 100% of the float of the company -- has been a “highly unusual" situation.
Volumes in GameStop options remained high, with open interest in puts and calls rising further last week as the stock price tumbled. While calls open interest has climbed, volumes on the bearish put contracts have jumped to almost five times the amount.
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This story has been published from a wire agency feed without modifications to the text.
