A crosscurrent of influences washed over the stock market Tuesday, causing some unusually volatile action. Meme-stock trading, typically crowd-sourced trades driven by social media attention, returned to the market with some gusto on Monday. The swirl of investor attention also appeared to launch some harshly volatile moves in a number of stocks not typically associated with meme stocks. Notable gainers, at least briefly, included Plug Power, Rivian and Rent the Runway. Highly shorted stocks, such as Beyond Meat, also exhibited sharp swings.
Rent The Runway Leads Trending Stocks
Rent the Runway rose 16% on the stock market today. The apparel renting service recently gave an optimistic outlook for the upcoming year. It recently said artificial intelligence tools could power its growth. That led to a single-day gain of 162% on April 11.
In April, a 1-for-20 reverse stock split helped the company avoid Nasdaq delisting. Rent, once a highly shorted meme stock, now shows much lower short interest than in the past.
Plug Power and FuelCell Energy climbed 19%-24% Tuesday. Plug Power announced a $1.66 billion conditional commitment loan guarantee from the Department of Energy. The firm hopes to develop up to six green hydrogen production plants. FuelCell is another play on the global transition to cleaner forms of energy. Some of Plug stock's big gains on Tuesday can be linked to the meme-stock rally in highly shorted stocks.
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On Holding leapt up 18% today. The maker of OnCloud sneakers posted a first-quarter earnings and revenue beat. The company reported strong demand in the direct-t0-consumer channel.
Sunrun, Rivian and Lucid, meanwhile, advanced 3%-11%. The rally cameas President Joe Biden implemented a round of precision tariffs aimed at protecting U.S. clean energy and EV industries from Chinese imports.
Today, few Chinese cars are sold in the American market. The new tariffs aim to ensure they stay out, as China exports its state-sponsored industrial overcapacity across world markets. The tariffs also remove the threat of future competition for the domestic EV and solar pure plays.
Producer price index data released by the Bureau of Labor Statistics on Tuesday showed ongoing pressure from inflation in April. But some downward revision of prior-month numbers, along with moderation in health care prices and airfares, triggered some additional positive trade. That appeared to provide an added boost to stocks already riding meme-stock and China tariff highs.
Meme Stocks Rally
GameStop and AMC Entertainment marked the return of meme stock trade, rallying 62% and 29%, respectively, on Monday. On Tuesday, GamesStop initially soared 113%, then pared gains. AMC spiked 129% early, then also trimmed gains.
The meme craze returned as market influencer Keith Gill, known as Roaring Kitty, tweeted for the first time in nearly three years.
Beyond Meat bolted 30% higher, then whittled that down to a 0.6% advance. The maker of plant-based meats is a highly shorted stock. Short sellers exiting stocks often amplify stock rallies. Short sellers of GME stock alone were estimated to have lost $2.2 billion from Monday to midday Tuesday.
Other meme stocks rallied for a second straight day as well. The group includes BlackBerry, Koss, Tupperware and Virgin Galactic.
Over the past 24 hours, AMC stock, GameStop and BlackBerry are the three top trending stocks on Reddit, according to stock sentiment tracker Apewisdom.com.
Reddit stock itself jumped 7.1% Tuesday, continuing its post-earnings rally. The stock debuted in March.
