On Tuesday, meme stock volatility caused the New York Stock Exchange to halt trading in AMC Entertainment and GameStop.
Shortly after the market opened on Tuesday, drama ensued as the NYSE paused trading for AMC (ticker: AMC) and GameStop (ticker: GME) for roughly five minutes. The move was instituted under the Limit Up- Limit Down plan, which aims to prevent stock trades from occurring outside specified price levels and curbing volatility.
AMC shares gained roughly 45% in premarket trading on Tuesday, while GameStop was about to gain 25%. The prices continued to rise after markets opened and then suddenly began their precipitous drop that prompted the trading halt.
Shares of the video game retailer climbed to $199 and then dropped to roughly $180, while cinema operator’s stock rose as high as $34, but within minutes was dropping. The previous week was eventful for both stocks as GameStop shares climbed following Chairman Ryan Cohen’s purchase of 100,000 shares of the video game retailer.
Earlier in the month, AMC made the announcement of its plan to purchase a stake in Hycroft Mining Holding Corp (ticker: HYMC). While on Monday, AMC stock shot up by 45% after the company’s CEO, Adam Aron, told investors to expect more “transformational” deals in the future.
“I’d like to think there will be alot more third-party external M&A announcements going forward where AMC can reach for the stars and intriguing investments that have potentially attractive returns,” said Aron.
When trading resumed at around 9:43a.m Eastern time, shares of AMC had dropped 8.5%, and GameStop was down 13%. The moves seems to hint at the beginning of another meme stock market frenzy after a long time spent in calm waters owing to slowed retail participation.