GameStop, AMC extend gains but broader meme stock rally shows signs of fizzling

GameStop and AMC logged further gains in premarket trading as the broader meme stock frenzy fizzled early on its third day, with Blackberry shares flat and Koss edging lower.

Brick-and-mortar video game retailer GameStop was up 10.16% at 6:40 a.m. E.T., while movie theatre chain AMC rose 9.20%.

Other so-called “meme stocks” were mixed in pre-trading. Shares of one-time popular smartphone maker BlackBerry were up just 0.58% and headphones manufacturer Koss fell 4.39% at 06:42 a.m. E.T.

The meme stock craze resurged on Monday, seemingly reignited by a rare social media update from “Roaring Kitty.” The man, whose legal name is Keith Gill, posted a picture on the X social media platform of a video gamer sitting forward on their chair — a meme used by gamers to indicate they are taking the game seriously.

Gill, also known as DeepF——Value on Reddit, is a former marketer for Massachusetts Mutual Life Insurance, who previously led a host of day traders piling into GameStop back in 2021.

The return of the meme stock phenomenon brought GameStop and AMC shares up over 70% on Monday, with the stock extending gains into Tuesday. Enthusiasm appeared to be fading by the close of the previous session.

Speaking on CNBC’s “Street Signs Europe” on Tuesday, Smead Capital Management CEO Cole Smead described the meme stock craze as “frankly stupid.”

“It is gambling,” he said.

— CNBC’s Yun Li contributed to this report.