Shares in small Australian nickel and cobalt explorer GME Resources have jumped as much as 53 per cent, apparently driven by the similarity of its stock ticker code to US retail investor darling GameStop.
GME Resources stock closed up 13 per cent at 8.5 Australian cents on Thursday, or a gain of one cent on the day, giving up most of its gains of four cents in early trade, when it reached $A0.115.
It had previously risen 14 per cent on Wednesday.
“There are people buying the stock for s***s and giggles, just because of the ticker symbol,” market analyst Kyle Rodda, of brokerage IG Markets in Melbourne, said.
“It’s all caught up in this GameStop dynamic,” he said.
“It’s got nothing to do with the company and entirely to do with this mad phenomenon that we’re seeing at the moment where these Redditers are looking to swarm into these stocks and play around with the market a little bit for their own amusement.”
Shares of US video game retailer GameStop have soared about 17-fold since January 12 as small investors, organising on social media sites including Reddit, have piled in and forced professional short-sellers to abandon their positions with heavy losses.
A spokesman for GME Resources was not available for comment.
However, the company’s managing director Peter Sullivan told the Sydney Morning Herald the surge had caught him by surprise.
“When I opened my share tracking app and saw it was at 9.4 cents, I was stunned,” he said.
“It just went bang, and I thought ‘Well, what’s going on here? Is there something about my own company that I don’t know?’.
“Eventually my brother’s son, who works in Sydney, told us it was about speculation to do with the ticker GME,” he said.
“I was hoping to be able to say it was more to do with our world-class nickel projects.”