Inside the AMC options action with Jon Najarian

Jon Najarian and the 'Halftime Report' traders discuss the options activity surrounding the meme stocks today, in particular AMC and GME. With Short Hills Capital's Steve Weiss. Subscribe to CNBC Pro to access full episodes of Halftime Report: https://cnb.cx/3ce6VBA

AMC Entertainment shares fell more than 10% on Thursday following a stock sale announcement, halting a massive rally led by retail traders.

The stock price dropped more than 30% at points and reached as low as $37.66 during the session after AMC said it may offer and sell “from time to time” up to an aggregate of 11.55 million shares of its Class A common stock. Additional shares dilute the value of the existing stock for existing shareholders.

Then, AMC shares rallied off their lows after the company said it completed the offering just a few hours later, raising about $587.4 million. The stock was 13.5% lower at $54.12 by 1:16 p.m. ET.

The NYSE halted the stock momentarily for volatility shortly after the open.

The move comes after AMC soared 95% in the regular trading session Wednesday to close at an all-time high of $62.55. Its previous closing record of $35.86 was reached in 2015, according to FactSet data.

AMC’s stock spiked as it hit an intraday high of $72.62, well above its previous intraday record of $36.72.

Trading was halted several times Wednesday as shares were up more than 100% at one point. At the end of the day, more than 710 million shares exchanged hands. That’s nearly double the number of AMC’s shares outstanding. The company’s 30-day average volume is just 143 million shares.

Retail investors — many active on Reddit’s WallStreetBets forum — led the AMC rally, and AMC executives have taken note. On Wednesday, the company announced a new portal to connect with individual investors and offered free popcorn, exclusive screenings and other perks to those who hold its stock.

JPMorgan noted that in the last week, retail order flow into AMC jumped to $583 million, 6.9 standard deviations above the average level of the last one year. According to their quantitative strategy, this kind of imbalance can lead to more outperformance by the stock in coming weeks.

AMC shares are up 2850% so far this year, bringing its market capitalization to more than $31 billion. That makes it worth more than stocks like Delta Air Lines, State Street and Best Buy.

In a similar occurrence seen in January with the meme stocks like GameStop, defiant short-sellers have increased their bets against AMC shares over the last month, possibly fueling the move higher. About 18% of the AMC shares available for trading are still sold short through Wednesday, according to S3 Partners.

On Wednesday, short-sellers lost $2.8 billion as the stock surged, according to S3. That brings their year-to-date losses to more than $5 billion, according to S3.

» Subscribe to CNBC TV: https://cnb.cx/SubscribeCNBCtelevision
» Subscribe to CNBC: https://cnb.cx/SubscribeCNBC
» Subscribe to CNBC Classic: https://cnb.cx/SubscribeCNBCclassic

Turn to CNBC TV for the latest stock market news and analysis. From market futures to live price updates CNBC is the leader in business news worldwide.

The News with Shepard Smith is CNBC’s daily news podcast providing deep, non-partisan coverage and perspective on the day’s most important stories. Available to listen by 8:30pm ET / 5:30pm PT daily beginning September 30: https://www.cnbc.com/2020/09/29/the-news-with-shepard-smith-podcast.html?__source=youtube%7Cshepsmith%7Cpodcast

Connect with CNBC News Online
Get the latest news: http://www.cnbc.com/
Follow CNBC on LinkedIn: https://cnb.cx/LinkedInCNBC
Follow CNBC News on Facebook: https://cnb.cx/LikeCNBC
Follow CNBC News on Twitter: https://cnb.cx/FollowCNBC
Follow CNBC News on Instagram: https://cnb.cx/InstagramCNBC

https://www.cnbc.com/select/best-credit-cards/

#CNBC
#CNBCTV

Видео Inside the AMC options action with Jon Najarian канала CNBC Television