Is the meme stock craze a bad thing once again?
Indicates that the US stock market is in a bubble, and the hype around meme stocks is not a good thing.
According to the latest survey by Bloomberg Markets Live Pulse, this week's meme stock frenzy indicates that there is a bubble in the US stock market and it may be reaching its peak.
$GameStop (GME.US)$GameStop and $AMC Entertainment (AMC.US)$AMC Entertainment Holdings are the two darlings of the meme stock frenzy in 2021. Their stock prices skyrocketed after Keith Gill, also known as Roaring Kitty, a retail trading idol, posted a mysterious message on the social media platform X. However, the stock prices of these two companies then plunged.
GameStop soared nearly 180% on Monday and Tuesday, while AMC surged 135%. However, they faced sell-offs on Wednesday and Thursday and lost more than half of their gains.
Despite the wild price movements, which have revived memories of the meme stock frenzy a few years ago, many of the 230 respondents in the MLIV Pulse survey doubt that this is an encouraging sign for the entire stock market.
With the $S&P 500 Index (.SPX.US)$S&P 500 index and $Nasdaq 100 (LIST91325.US)$The Nasdaq 100 index hit a new high this week, and more than 40% of respondents believe that the trading of GameStop and AMC is a sign of excessive excitement and a potential reason to sell. GameStop fell about 25% on Friday morning.
Is the stock market too excited?
Steve Sosnick, Chief Strategist of Interactive Brokers, said over the phone, 'We wouldn't see this meme stock continue to soar unless the stock market was somewhat enthralled.'
According to an MLIV Pulse survey, 43% of respondents see the surge of meme stocks as a reverse warning for the future market. About a quarter of respondents see it as a bullish signal for stock prices.
At the same time, 66% of respondents believe that this will not pose a real threat to the entire stock market.
Compared to the hype in 2021, the recent surge in meme stocks is basically short-lived. At that time, retail investors united to drive up the stock prices of Wall Street short targets, resulting in a large-scale rebound.
This action was fueled by boredom during the lockdown period, zero-cost brokerages, and social media chat rooms. It took investors and Wall Street professionals weeks to understand.
One similarity is that several respondents pointed out that boredom was one of the reasons driving the latest action.
The current stock market rally is mainly due to the resilience of the US economy, strong consumer spending, and declining inflation, which provide growth momentum and boost the outlook for US companies.
Policy makers at the Federal Reserve have made it clear that they plan to maintain higher interest rates for a longer period of time to curb inflation. This level of economic strength gives policymakers no reason to rush to cut rates.
"If the Federal Reserve waits too long to cut rates, it could lead to economic weakness and put pressure on the stock market," said Stephanie Lang, Chief Investment Officer at Homrich Berg.
"Although there was a quick pullback in meme stocks, it is a healthy signal for the market."
While investor confidence has been strengthening, one area of the market indicates that there has not been an excessive rally.
According to ETF analysts at Bloomberg Industry Research, leveraged long exchange-traded funds (which use derivatives to amplify daily index returns) have not shown the same enthusiasm as they did during the meme stock frenzy in 2021.
Experienced traders driving.
Another significant difference between the recent meme stock trend and the frenzy of 2021 is that this time it is driven by experienced traders rather than retail investors.
Sosnick的数据显示，在截至周三的五个交易日，GameStop是盈透证券客户订单最活跃的股票，AMC排名第17位。
Sosnick还表示，尽管GameStop出现了净买入兴趣，但期权市场也出现了净卖出兴趣，这表明投资者的备兑看涨期权或其他风险控制策略不仅仅是投机。
这就是Hedge Fund Telemetry创始人托马斯·桑顿做空 $SPDR S&P Retail ETF (XRT.US)$SPDR S&P Retail ETF（XRT）的原因。
GameStop是该基金最大的权重，而债务缠身的在线汽车零售商Carvana公司（另一个受欢迎的迷因股）则是第二大权重。
“试图做空其中一些迷因股太危险了，”托马斯·桑顿说。“天知道咆哮的凯蒂猫会不会继续发帖。我的生活中不需要这种压力。”
Source: Nanyang Business Daily
Disclaimer: This content is for reference and educational purposes only and does not constitute any specific investment, investment strategy, or recommendation. Readers should assume any risks and responsibilities resulting from relying on this content. Before making any investment decisions, please conduct your own independent research and evaluation, and consult with professionals when necessary. The author and related contributors are not responsible for any losses or damages incurred as a result of using or relying on the information contained in this article.
Disclaimer: Community is offered by Moomoo Technologies Inc. and is for educational purposes only.
Read more
Comment
Sign in to post a comment
Nanyang Siang Pau Official Account
《南洋商报》创立于1923年，是马来西亚历史最悠久的中文报纸之一。以财经及商业新闻为主，是商家与投资者必备的新闻资讯平台。
5756Followers
1Following
6234Visitors
Follow
MY马股最重要赚大赔小 : Hi Nanyang admin, can you write another meme on US stocks when you have time? New meme US stocks. thanks