By Barbara Kollmeyer
A band of merry retail investors has been spicing up the normally dull days of August.
Wednesday’s meteoric rise in Robinhood /zigman2/quotes/228268942/composite HOOD +0.24% shares caught much of Wall Street off guard, and left some in the retail space baffled as the no-fee trading app appeared to fast-track itself into a coveted meme space.
Our call of the day from VandaTrack, a tracker of individual investor purchases, offers a glimpse at just how far that push might go for Robinhood, which just a week ago suffered a disastrous debut . Note, the stock is down Thursday after the company said shareholders will sell 98 million shares .
“Robinhood has only seen US$100 million in retail purchases this week. If retail investors start withdrawing money from tired meme stocks to buy HOOD, there is still room for the move to continue,” said senior strategist Ben Onatibia and analyst Giancomo Pierantoni in a note on Thursday. VandaTrack provides daily data on retail investors’ net purchases of US single stocks and ETFs.
In January short squeeze, retail investors spent $352 million on net purchases of GameStop /zigman2/quotes/203755179/composite GME -0.30% , while AMC Entertainment’s /zigman2/quotes/200235402/composite AMC +1.67% subsequent bubble drew $600 million at its peak.
VandaTrack data also shows HOOD was the third-most purchased stock — $50.5 million — on retail platforms Wednesday. A total of $467 million buys and sells for that stock placed it fourth in volume behind a mega S&P ETF /zigman2/quotes/209901640/composite SPY +0.76% , chip stock AMD /zigman2/quotes/208144392/composite AMD +0.12% and COVID-19 mMRA vaccine maker Moderna /zigman2/quotes/205619834/composite MRNA -2.31% on the day.
In a separate note, Onatibia and Pierantoni observed that retail buying of U.S. equities is at its lowest since May, which is partly due to summer vacations and a lack of sector-specific stories to get excited about. Tech is one category that has seen flows improving, at the expense of cyclical stocks.
Vaccine manufacturers such as Moderna and Pfizer have also seen a jump in retail buying, they noted.
“Over the past 10 days, they have seen combined net inflows of US$180 mln, the largest amount since the results of the clinical trials were published in November. The rise in global cases of the delta variant, the imminent FDA approval and the rise in vaccine prices have all coalesced to turbocharge the rally,” said the pair.
Shares of Moderna, which just reported a big profit beat and 199 million doses of its COVID-19 vaccine sold, have climbed over 300% this year, though mMRA rival BioNTech /zigman2/quotes/214419716/composite BNTX -1.06% has jumped 400%, while Pfizer /zigman2/quotes/202877789/composite PFE -0.43% is up 22%.
Weekly jobless claims and an EV-auto pledge
Earnings rolled in from Cigna /zigman2/quotes/208431372/composite CI +1.55% ,, with Expedia /zigman2/quotes/202291990/composite EXPE +1.84% and American International Group /zigman2/quotes/203700638/composite AIG +0.88% due after the close.
Uber shares /zigman2/quotes/211348248/composite UBER +2.28% are sinking after the ride-share group reported a revenue surge, but also an adusted loss . Electronic Arts /zigman2/quotes/206954087/composite EA -0.71% is climbing after the videogame maker’s results topped forecasts. Roku /zigman2/quotes/205087179/composite ROKU -1.38% also reported upbeat results, but the streaming device maker’s shares are down on slow account growth. Online marketplace Etsy /zigman2/quotes/202790087/composite ETSY +2.40% is taking a hit post-earnings as it reported fewer active buyers.