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The US Securities and Exchange Commission warned Monday that it is closely watching frantic moves in the stock market, amid a massive surge in the stock values of AMC Entertainment and GameStop Corp.
The employees of the Saudi Electricity Company continue to monitor the market in light of the continuous fluctuations in some stocks to determine if there is any market turmoil, manipulative trading or any other misconduct. In addition, we will act to protect retail investors if violations of federal securities laws are found,” the SEC said in a statement provided by a spokesperson for the regulator.
The regulatory statement comes with AMC Entertainment Holdings AMC + 13.99% up 20% on Monday, up over 2,600% in the year to date. Meanwhile, GameStop Corp. shares soared. GME + 10.49% is up over 12% and is up almost 1400%.
By comparison, the Dow Jones Industrial Average DJIA -0.42% is up over 13% this year, the S&P 500 SPX is up -0.22% by more than 12%, and the Nasdaq Composite +0.24% is up more than 7%.
Since the beginning of the year, individual investors have been betting aggressively on companies like GameStop, AMC Entertainment, and others, in a coordinated effort to boost companies’ shares on social media sites like Reddit and Discord.
Meme stocks are those that rise based on social sentiment but not necessarily on fundamentals.
The SEC statement about the memes, as top agency officials were speaking at a CFO Network event in The Wall Street Journal on Monday, comes as SEC President Gary Gensler noted that the regulator was monitoring areas of the market that have gained significant buzz, including That’s Special Purpose Acquisition Companies, or SPACs, which have been seen as a risk area for retail investors.
Gensler, who was chairman of the Commodity Futures Trading Commission during the Obama administration, took control of the Securities and Exchange Commission in April.
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