The meme movement has added volatility into corners of a market already contending with rising interest rates, recession risks and a steep drop from the record highs. That was on display this month with Bed Bath & Beyond Inc. and AMC Entertainment Holdings Inc., two meme favourites, both surging, only to give back the gains just as quickly.Article content
Speculating in meme stocks has been painful this year. Even the coordinated efforts have been no match for a rout that’s battered individual-investor picks like high-growth technology stocks and cryptocurrencies. A basket of 37 retail-trader favourites tracked by Bloomberg is down nearly 40 per cent in the past year.
Wall Street professionals are split on whether the market won’t hit a bottom until individual investors withdraw their support by becoming net sellers of stocks. The group has recently pushed US$1.2 billion per day into U.S.-listed securities, according to Vanda Research, below its expectations for a US$1.3 billion to US$1.4 billion influx. With the S&P 500 off its mid-month highs, that signals a potentially diminished appetite for buying such dips.