Bed Bath & Beyond Jump Brings Some Meme Frenzy to Broad Rally

Retail traders who lurk in forums like Reddit’s WallStreetBets are back to betting against Wall Street pros and the Federal Reserve as rallies for meme stocks like Bed Bath & Beyond Inc. and AMC Entertainment Holdings Inc. show shades of last year’s mania.
The home-good retailer has nearly tripled over a nine-day winning streak while the movie-theater firm is riding a more than 75% rally of its own as speculative pockets of the stock market surge. The pair have powered a basket of 37 meme stocks tracked by Bloomberg higher by 12% over the past week while the most-hated stocks tracked by a Goldman Sachs Group Inc. basket is up nearly 20% over the same period.
The resurgence of more speculative areas of the market is likely fueled in part by individual traders willingness to jump on riskier trades and bet against hedge funds. A rally in tech shares and other growth stocks has helped push the Nasdaq 100 Index on Monday up 20% from a June low despite alarms from some on Wall Street that the Federal Reserve is dead-set on fighting inflation regardless of the pain for the stock market.
The “smart guys” are “confused, baffled and fighting short positions from a position of weakness in terms of momentum and firepower,” said Mark Taylor, a sales trader at Mirabaud Securities. “The lack of real understanding of why a sudden resurrection of the meme-entum bid could lead to some nefarious speculation about things being manipulated but what would be as much sour grapes speculation as anything real.”
Bed Bath & Beyond’s taking of the meme stock baton, rising 63% at one point on Monday as the stock became the most bought asset on Fidelity’s platform. AMC Entertainment saw the second most purchases while both company tickers were the most mentioned on Reddit’s WallStreetBets platform.
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A basket of meme stocks tracked by Bloomberg rose 5.4%, extending a six-day rally of its own. The top performers behind Bed Bath & Beyond and AMC Entertainment were GameStop Corp. and Express Inc. Newly-public Magic Empire Global Ltd., a little-known Hong Kong-based financial services firm, extended a 5,476% two-day surge since going public, attracting some retail attention.
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“These meme stock rallies that are emerging will only last if US stocks broadly continue to head higher,” ...