GameStop Extends Gains in After-Hours Trading as Risk On Mood Swells

Meme stock giant GameStop (NYSE: GME) saw a notable rise in its share price during after-hours trading on Tuesday, extending gains achieved earlier in the week.

Gains in broader markets are reflecting a positive sentiment for risk assets, encompassing crypto, despite recent political events, including the attempted assassination of presidential candidate Donald Trump on Saturday.

The stock is trading around $29.60 after rising to a top of $29.96 following the New York Stock Exchange’s closing bell, data shows.

After-hours trading for GME and other stocks listed on the NYSE typically occurs on electronic communication networks. These platforms allow for trading outside regular market hours.

It follows the stock’s rise on Monday – clocking its highest point in a month — and a 13% rise over the last 30 days.

GameStop, known as the original “meme stock,” gained widespread attention in early 2021 when retail investors on the Reddit forum r/WallStreetBets began buying shares en masse, leading to one of the most notable short squeezes in market history.

Despite the initial frenzy subsiding by early February of that year, GameStop has continued to attract investor interest, particularly with efforts to diversify its business.

GameStop’s recent announcement of a $25,000 reward for a rare Lionel Messi sticker from the 2024 Panini Copa America collection has garnered some attention, indicating the company’s strategy to go beyond its traditional video game market.

That may be playing into the hands of risk on traders who are forecasting the U.S. Federal Reserve will begin cutting rates as soon as September, according to the CME FedWatch Tool.

Cuts would likely inject additional liquidity into markets, including small-cap stocks.

The Russell 2000 Index, which tracks the performance of 2000 small-cap companies in the U.S., has increased by 12% over the past five trading days.

Interest rates matter because they influence borrowing costs and investment returns. When the Fed lowers rates, borrowing becomes cheaper, encouraging spending and investment.

This increases liquidity in the market as more money flows into various assets, including stocks and crypto.

Recent activity in GameStop and small-cap stocks also coincides with broader market trends, with major U.S. indices closing at record highs.

The Dow Jones Industrial Average has gained 2% this week, closing at 40,954.48. The S&P 500 has also risen 0.69%, reaching a top of 5,667.20, while the Nasdaq Composite increased by 0.21% to 18,510.86, market data shows.

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