Meme Rally Fades as Bed Bath & Beyond, Koss Lose Luster
(Bloomberg) -- The latest meme stock frenzy started to unwind Thursday as retail-trader favorites like Bed Bath & Beyond Inc. and Koss Corp. tumbled after surging in the previous session.
Bed Bath & Beyond shares fell 28%, the steepest selloff since January, after notching a record advance Wednesday. Koss slid 24% in the biggest drop in four months. Other so-called meme stocks including GameStop Corp. and PetMed Express Inc. also declined Thursday.
This comes as some retail investor favorites announced plans to sell shares. AMC Entertainment Holdings Inc. shares sank after the movie theater operator said it was planning a stock offering, then they briefly turned positive in the afternoon after the cinema chain announced the sale raised $587 million. AMC closed down 18% in the biggest slide since early February. Elsewhere, Express Inc. dropped 20% after announcing a potential share sale of its own.
PetMed Express, Bed Bath & Beyond, Express and AMC were the worst performers on the Russell 2000 Index Thursday.
Another sign of cracks in the meme stock rally is the whipsaw in BlackBerry Ltd. Shares in the company that has overtaken AMC in the number of WallStreetBets mentions dropped as much as 11%, after climbing 32%. They closed up 4.1%.
Still, some day trader favorites continued the rally higher. Workhorse Group Inc. soared 28%, the most in more than four months, while Clover Health Investments Corp. rose 2.3% and Zomedica Corp. gained 14%.
Pot stocks were also among those that rallied Thursday. Tilray Inc. rose 3.8% following an upgrade at Cantor Fitzgerald, and Sundial Growers Inc., which has been popular with retail traders, climbed 14%.
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