Shares in companies including videogame retailer GameStop soared again on Friday, as an army of small investors taking aim at Wall Street regained access to amateur share trading platform Robinhood. The app, weaponised by activist small investors to trap hedge funds in a "short squeeze" that has cost them $20bn on paper by some estimates, had suspended buying of stocks such as GameStop, cinema chain AMC and BlackBerry on Thursday. But it secured a $1bn (£730m) cash injection from its backers on Thursday evening, which the company said it required to allow its users to resume their buying spree, which began on the WallStreetBets forum of chat forum Reddit. The decision to permit what Robinhood said would be "limited buys" resulted in GameStop's shares climbing more than 67.6% on Friday, taking its notional value to more than $22bn, nearly 80 times what it was worth this time last year. The company's shares had whipsawed a day earlier, finishing the day 44% lower after Robinhood barred users from buying more stock, threatening the Reddit rebellion.
Fox Business Flash top headlines are here. Check out what's clicking on FoxBusiness.com. Rep. Alexandria Ocasio-Cortez and Sen. Ted Cruz on Thursday were among the many voices condemning the move by the retail trading platform Robinhood to restrict customers from trading shares of GameStop -- but the sophomore congresswoman said she had no interest in working with Cruz to hold Robinhood accountable because Cruz "almost had me murdered 3 weeks ago." Ocasio-Cortez, D-N.Y., was referencing Cruz's challenge to Arizona's Electoral College votes earlier this month as Congress met to certify President Biden's election win. Cruz's challenge has been linked by many to the attack on the Capitol by a pro-Trump mob that was fueled by the former president's false claims that he'd won the presidential election.
One of the more overused adages about business on the internet is that "if you aren't paying, you are the product." It's always been true, but it's become acute lately. Microsoft, Apple, and Amazon mostly sell you things like phones, computers, web-hosting services, and Instant Pots. On the other hand, Google, Facebook, and Visa largely sell you. You don't need to pay for a Visa card, but Visa sells its cardholders to companies all over the world.
A day after shares of U.S. retailer GameStop rose 135% -- a wild upswing spurred by an online army of investors on a mission to challenge the dominance of Wall Street -- Robinhood, the stock-trading app at the center of it all, clamped down. Almost immediately, GameStop's shares plunged, falling 75% in 90 minutes. The limits on trading by Robinhood and other online brokerages, put in place as fears of market instability grew more widespread, set off a furious outcry among small investors. They claimed that the very apps that had democratized trading -- Robinhood in particular -- were now doing the bidding of Wall Street. Small groups of investors protested outside the New York Stock Exchange and at the Menlo Park, California, headquarters of Robinhood, a company that popularized the notion of commission-free trading.
Shares of video game retailer GameStop shot up, the online broker Robinhood struggled for cash and securities regulators issued a stern warning for anyone trying to game the market. Shares of video game retailer GameStop shot up, the online broker Robinhood struggled for cash and securities regulators issued a stern warning for anyone trying to game the market. The GameStop stock-market roller coaster continued Friday as the video game retailer's shares shot up, the online broker Robinhood struggled for cash and securities regulators issued a stern warning for anyone trying to game the market. Catapulted by seemingly unrelenting enthusiasm on Reddit, GameStop stock soared more than 70%. On Thursday, it had plunged 44%.