Saturday Dec 3, 2022
Saturday Dec 3, 2022

Wall Street’s GameStop bug may have mutated; silver surges

2021 Feb 02, 11:29, NEW YORK
In this file photo dated Wednesday, May 9, 2007, Silver bullion, bars weighing five kilograms each, are displayed in the trading room of the stock exchange in Frankfurt, Germany. Silver futures jumped more than 10% on Monday Feb. 1, 2021, following strong gains over the weekend. Photo via AP

The erratic trading in shares of underdog companies like GameStop that turned markets combustible last week appears to have migrated to commodities, sending silver prices surging to an eight-year high.

Silver futures jumped more than 9% on Monday to $29.42 per ounce with #silversqueeze trending on Twitter. That exuberance spread to companies that mine precious metals, especially silver. Shares of Pan American Silver surged about 12%, First Majestic Silver rose 22% and Hecla Mining spiked 28%.

Last week, there were messages on the Reddit forum WallStreet Bets and other places on social media encouraging small investors to buy silver. The metal shot up Monday, but many of the online investors said it wasn’t them bidding up the price.

An online army of Reddit traders banded together for the past week to snap up thousands of shares of GameStop, AMC and other struggling chains, stocks that have been heavily shorted (bets that the stock will fall) by a number of hedge funds. In the process, they’ve done heavy damage to those hedge funds in a stunning reversal of financial power on Wall Street.

Some of these smaller traders believe the hedge funds that were pillaged last week are behind the surge in silver. Communications on messaging boards claim hedge funds have now become active on Reddit anonymously, attempting to drive them out of GameStop bets and into silver, but only after hedge funds had taken huge positions.

“IT’S A TRAP!” one Redditor warned, though no one really seemed certain.

Meanwhile, GameStop shares dropped 28% to $233 but the stock price has been tremendously volatile of late. Last week a 44% drop on Thursday was followed by a 68% jump Friday.

The number of GameStop shares that have been shorted (bets that the stock will fall), were slashed by more than half in recent days, according to a report Monday by the analytics firm S3 Partners.


– Asian stocks follow Wall St up, silver eases off high

– Fight The Man: What GameStop's surge says about online mobs

– For GameStop day traders, the moment they've dreamed about

– EXPLAINER: Why GameStop's stock surge is shaking Wall Street

Last week’s turmoil caused hedge funds to pull back on their investments by the sharpest degree since February 2009, during the market collapse caused by the financial crisis, according to Goldman Sachs, which provides services such as clearing and consulting to hedge funds.

Goldman says hedge funds have have been getting out of both short sales, where they’re betting a stock will fall, and more traditional investments that bank on rising prices “in every sector,” according to a Goldman Sachs report Monday.



Nepal's First Online News Portal
Published by Nepalnews Pvt Ltd
Editor: Raju Silwal
Information Department Registration No. 1505 / 076-77


KMC-02, UttarDhoka,
Lazimpat, Nepal

+977–01–4445751 / 4445754

[email protected] [email protected]

Terms of Use Disclaimer
© NepalNews. 2021 All rights reserved. | Nepal's First News Portal