FTSE 100 closes down as Reddit frenzy continues
The FTSE 100 closed nearly two per cent down at the end of the week, with investors spooked following a volatile week in markets.
London’s main market closed down nearly two per cent, and the FTSE 250 finished nearly 70 per cent down.
Wall Street also suffered today, down more than two per cent across the board mid-trading.
Investors have been rattled by an attack on Wall Street hedge funds by an army of Reddit day traders.
Although hedge funds have taken out large short positions in the firm, an army of Reddit investors have flocked to the nostalgia stock in the past week lifting its share price to new heights.
Gamestop shares have soared more than 300 per cent in the past week.
The FTSE 100’s drop came even after a rally on Wall Street yesterday where Gamestop and Reddit investors remained the hot topic.
Gamestop stock dropped as brokers started to place restrictions on the most shorted stocks, including AMC Cinema, with Reddit investors threatening legal action.
“The strength of the pound is a perpetual issue for the UK index at the moment, as are fears over the length of lockdown and concerns over any potential hiccups in the vaccine rollout,” Connor Campbell, financial analyst at Spreadex said.
Cable held above the 1.3600 area yesterday with a move towards 1.4000 on the cards.
It has been a quiet start to trading on the FTSE this morning with just a handful of trading updates. Boohoo shares have dropped one per cent after confirming it is in talks with Philip Green’s Arcadia about buying Dorothy Perkins, Wallis and Burton.
Across Europe markets opened lower with Germany’s Dax and France’s Cac opening down 1.7 and 1.9 per cent repsectively.