Meme stocks don’t always respond to actual news items like other stocks do [see GameStop
on Monday] but when they do, we get days like Thursday, where a swirling news cycle hits a frothy market move and magic happens.
It meant great news for chip maker Nvidia Corp.
and very bad news for Penn National Gaming
Nvidia got a major boost from growing speculation that the company is likely to announce the general availability of its Omniverse Enterprise during its GTC Conference on Nov. 8, providing it with a chance to capitalize on the company formerly known as Facebook’s
new “metaverse” technology.
That news sent Nvidia stock as high as 17% before shares closed up 12%. The company’s market cap rocketed over $700 billion for the first time in its history.
Nvidia also was the biggest name on social media, with mentions spiking more than 1,000% according to HypeEquity.
On the flip side of the news cycle was Penn National, which closed down 21% as the gambling operation whiffed badly on its third-quarter earnings and then got hit with a second whammy.
Penn National’s meteoric stock saw it go from a penny stock to a 1,500% gain in months, thanks in large part to its January 2020 partnership with Barstool Sports, the ribald sports—and other news— site run by performative provocateur Dave Portnoy.
Portnoy, who became a vocal player early in the retail trading boom, rechristening himself as “Davey Day Trader,” while picking Twitter fights with hedge funders like Point72’s Steve Cohen and promoting Penn National’s stock, also on Thursday played a role in the company’s stock cratering.
A bombshell report from Business Insider contained numerous allegations from multiple women claiming they had disturbing and violent sexual encounters with Portnoy.
In response, Portnoy took to social media to record a [painfully watchable] nearly 10-minute video calling the story a “hit piece,” denying the events described by women in the Business Insider report, while saying “cancel culture has been coming for me for a decade.”
Social media mentions of PENN spiked more than 2,500% on Thursday, with 10% of those referring to “Portnoy.”
Elsewhere, Bed Bath & Beyond
shares closed up 4.5% on the day, adding to a 5-day rise of nearly 40% and what appears to be a short squeeze.
GameStop gave up early gains to close down 0.2% despite news that the company announced a new $500 million global asset-based credit facility that will replace its existing $420 million one due in late 2022.
And speaking of GameStop, get ready for an avalanche of virtual rage on Friday as Reddit’s “Apes” digest Thursday news that Citadel Securities is attempting to have a civil case against it in Florida thrown out, using the much-maligned SEC report on GameStop’s January short squeeze as legal proof that the market maker did not collide with Robinhood
in the lead up to the zero-commission trading app’s decision to restrict trading on GameStop at the height of the squeeze.
And lastly, AMC Entertainment
CEO Adam Aron still really, really, really likes popcorn: