Jobs lost to the pandemic will take years to return, a labor organization says.
AMC Entertainment, the movie theater chain that’s been a target of small investors in so-called meme stocks, soared on Wednesday, climbing to a $30 billion market valuation.
The shares rose 115 percent by midafternoon, to above $68 apiece, extending a run that has lifted them by more than 3,100 percent this year. The gains were quick enough to warrant a trading pause on the New York Stock Exchange, a measure aimed to allow traders to catch up to a quickly rising or falling stock.
The trading mirrors a frenzy in shares of GameStop in January. Then, like now, small investors egged each other on in forums like WallStreetBets on Reddit, by sharing their successes and ideas and encouraging more buying. Their reasons vary: Some of the earliest investors were driven by the view that companies like AMC and GameStop were being undervalued, others are hoping to help push up the price to force losses onto hedge funds that bet against the stock, and others still aren’t taking the investment seriously at all.
Shares of GameStop rose about 7 percent on Wednesday, to about $267, but are well below their highs from late January when the stock climbed to as high as $347.
AMC acknowledged its growing base of small investors on Wednesday, saying it would offer them perks like free popcorn. The company said in a statement that more than three million small investors own its shares, and their ownership accounts for more than 80 percent of its shares.
“Many of our investors have demonstrated support and confidence in AMC,” Adam Aron, AMC’s chief executive, said in the statement.
The company has also taken advantage of the run-up in shares to bolster its financial position. AMC on Tuesday said it raised $230.5 million by selling shares to a hedge fund. The hedge fund, Mudrick Capital Management, has since sold the stake, Bloomberg News reported.
Elsewhere in Markets
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Stocks in the United States and Europe were slightly higher on Wednesday. The SP 500 rose 0.2 percent and the Stoxx Europe 600 climbed 0.3 percent.
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Oil prices climbed with futures continuing at their highest since late 2018. West Texas Intermediate, the U.S. benchmark, climbed above $68 a barrel.
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Recent economic data has pointed to a strengthening economic recovery, but investors are closely watching for inflation that might require central banks to take action that could curb growth. On Wednesday, the Organization for Economic Cooperation and Development said that the annual inflation rate across its 38 member countries rose to 3.3 percent in April 2021, compared with 2.4 percent in March. The jump was fueled by an increase in energy prices of 16.3 percent, the highest rate since September 2008.
Article source: https://www.nytimes.com/live/2021/06/02/business/economy-stock-market-news/