From the wsj’s “Stock Futures Point to More Losses on Wall Street; GameStop in Focus” posted early Thursday:
U.S. stock futures dropped, putting Wall Street on course to extend losses amid investor concerns about a slowing economic rebound and froth in markets, exemplified by the wild trading in retailer GameStop…
The stumble in stocks follows a strong start to the year that some investors say had pushed share prices beyond levels justified by corporate fundamentals. The selloff has taken place amid wild swings in individual stocks including GameStop and AMC Entertainment,AMC 301.21% fueled by a battle between day traders and hedge-fund professionals.
“There is some over-excitement in the market,” said Olaf van den Heuvel, chief investment officer for Aegon Asset Management in the Netherlands, pointing to the surge in GameStop shares as one example. “It was bubble territory.”
GameStop shares fell 8.5% ahead of the bell in New York, having rocketed 135% Wednesday. AMC dropped 23%, trimming Wednesday’s gains of more than 300%.
The slow vaccine rollout and Covid-19 restrictions in major economies have prompted investors to take some money off the table, Mr. van den Heuvel added. He said Aegon would likely view the selloff as a chance to buy risky assets when markets settle down.
Technology stocks dropped ahead of the bell in New York. Shares of Apple fell 3.4% after the iPhone maker reported its most profitable three months on record but didn’t provide specific revenue guidance for the current quarter.
My take: Beats me.