Tuesday, 9 August, 2022
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GameStop mania spreads to glove makers in Asia

The moderators of the group Bursabets have defined it as the 'Malaysian version' of Reddit’s WallStreetBets forum, to discuss stocks listed on Bursa Malaysia.

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Mumbai: The manic ride in GameStop Corp. sparked by American amateur traders on Reddit has inspired some Malaysians to form a similar group targeting shares of glove makers — one of Asia’s hottest pandemic trades in 2020.

The online community by the name of Bursabets was created on Thursday and is already boasting more than 7,600 members. The moderators of the group have defined it as the “Malaysian version” of Reddit’s WallStreetBets forum, to discuss stocks listed on Bursa Malaysia. The discussions so far have centered on glove makers and calls to rally against institutional investors who have kept valuations of the sector low.

Shares of Top Glove Corp. jumped as much as 15% before paring those gains to close 8.5% higher. Rival Hartalega Holdings Bhd. surged 5.4% while Supermax Corp. climbed 3.7%. The benchmark FTSE Bursa Malaysia KLCI Index fell 0.9%, capping a third week of losses.

Glove makers have been among the most-shorted stocks in Malaysia since the nation lifted a ban on short selling at the start of 2021. Vaccine rollouts have also sapped the appeal of these pandemic winners.

“I just want the market to realize that the valuations are too low and that our glove companies deserve better,” Revenant, one of the moderators of the group, wrote in a post on Thursday. “Let’s discuss, let’s meme it up, and get people hyped!,” the moderator said about Malaysian equities.

GameStop has been the focus of a retail-investor-fueled frenzy in recent days that’s spread further beyond Wall Street. That’s caught the attention of Malaysia’s securities regulators which are urging investors to exercise caution when participating in social media chatrooms promoting specific stock trading.

The Securities Commission and Bursa Malaysia Bhd. said in a joint statement Friday that they are “closely monitoring” the local stock market in light of the current price surge of selected stocks in the U.S. markets, fueled by social media chatrooms against short-sellers.

“Investors should also be wary of discussions in these social media chatrooms that may trigger securities breaches such as the provision of investment advice or stock recommendations without a licence,” the statement said. When warranted, they will “take the necessary measures to curb disruptive trading practices and market abuse,” it said.

A member with the handle u/chen97 posted a meme with a wordplay on Avengers Assemble, an American animated television series based on the fictional Marvel Comics superhero team known as the Avengers. The meme said “Retailers Assemble! The Game just begins!.”-Bloomberg


Also read: Even Indian retail investors are playing with GameStop, US videogame stock that’s gone wild


 

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