Reddit Shocked US Indices For a Week

Reddit shocked US indices for a week. US stocks recorded their worst week since October.

There was some speculation recently on Reddit, which is known as a social news and discussion site. Wall Street got mixed up when Reddit users rushed on short-term stocks such as GameStop and AMC, suddenly gaining a record 1000% of shares. While earnings declined when trading platforms such as Robinhood and Interactive Brokers imposed transaction limitations, shares rose again when the platforms lifted the restrictions. Market actors expressed fear that retail traders targeting short positions could force hedge funds and sell long positions to cover bearish bets. Even though the GameStop incident shook a limited number of funds, analysts said they were concerned about a growing market disruption.   US indices were as follows at closing on Friday:

• S&P 500: 3,714.04 1.94% down
• Dow Jones industrial average: 29,980.84% ​​2.03 drop (622.52 points)
• Nasdaq Composite: 13,070.69 down 2.00%

  Lindsey Bell, Chief Investment Strategist of Ally Invest, made an assessment on the issue. Bell argued that pursuing the squeeze is like buying a lottery ticket and that profits can be made or everything can be lost; She stated that this kind of speculative trading is more about luck and not skill. In addition, the Securities and Exchange Commission, which made a statement on Friday, reported that market fluctuations have been monitored to understand whether there has been a crime recently. The commission noted that the sharp price volatility of stocks took the risk of exposing investors to "rapid and severe losses" and weakening general confidence.   Vaccine News Determines the Direction of Markets Dow Jones was shortly behind 30,000 for the first time since January 4, before partially recovering. Energy and technology stocks were the biggest losers of the session. All 11 of the S&P 500 sectors are close to closing, although healthcare and utilities have performed better. Cboe's VIX, the most well-known measure of market volatility, recorded its highest level since October. The index saw an intraday high of 37.51 and then closed just below 31. In addition to these, news about the coronavirus vaccine has also been effective in determining the direction of the markets. With the announcement that Johnson&Johnson's coronavirus vaccine candidate was 66 percent effective, investors went on sale. Johnson&Johnson also reported that their vaccine was less effective in South Africa. Although the markets were positive with the expectations of an incentive package of 1.9 trillion dollars announced by US President Joe Biden, the disruptions in vaccination studies destroyed this hope.