News: GameStop shares climb in early deals, on track for second best week.
(Reuters) – GameStop Corp shares rose 11% in early deals on Friday as retail investors pushed the stock up in yet another rally that saw it hit its second-best week.
Options market activity in the stock, which has returned to the top of the list in a social media-fueled retail frenzy, suggested investors were betting on higher prices or higher volatility, or both.
GameStop stocks hit $ 120.60 and were well on their way to nearly triple this week in a stock market where falling bond prices have weakened general investor sentiment towards US stocks.
Further support could come from holders of call options on the stock as a large portion of these weekly contracts expire on Friday.
The stock is still a long way from the $ 483 mark it hit in January when individual investors using Robinhood and other trading apps saw prices rise, which helped many hedge funds that had bet against the video game retailer. forced to cover short positions.
Refinitive data on options showed that retail investors bought deep-out-of-the-money-call options. These are options with contract prices that are well above the current share price.
Many of these options contracts expire on February 26th and would mean sizeable gains for those betting on GameStop’s stock price to rise further.
Call options, which would be profitable for holders if GameStop shares hit $ 200 and $ 800 this week, have traded particularly heavily, the data showed.
The Frankfurt listing of GameStop lost 21.3% and was quoted at 98.19 euros. In this move, the value converged almost completely with that of the US-listed stock, which gained almost a fifth in value on Thursday.
Other Reddit favorites like cinema operator AMC Entertainment, headphone maker Koss and marijuana company Sundial Growers were down between 4.4% and 13.6% before the bell.
Reporting by Aaron Saldanha in Bengaluru; Adaptation by Shinjini Ganguli and Anil D’Silva
Original Source © Reuters