Shares of retailers and other consumer companies fell sharply amid concerns about erratic trading in shares of videogame retail chain GameStop.

Shares of GameStop more than doubled in the day's session alone and are up almost 20-fold for the year to date, despite the fact that its primarily mall-based operations are struggling. Some longtime market watchers viewed the wild activity as a sign that stock-market speculation was nearing a peak.

The Biden administration was reportedly monitoring the situation with GameStop shares amid allegations that day traders orchestrated a "short squeeze," pushing up prices so that short-sellers were forced to buy back bets, by coordinating purchases of GameStop shares on Reddit. Asked for comment, a Reddit spokeswoman said the company's policies prohibit soliciting or facilitating illegal transactions.

One widely shared post on Reddit showed a screenshot of a user's stock-trading account that appeared to show a $22 million gain on a GameStop bet.

The short squeezes were not limited to GameStop. Shares of Bed Bath & Beyond, another mall-based retailer that's struggling with the impact of the coronavirus pandemic, rose by more than one-third, and have roughly doubled in the space of a week, as posters on Reddit sub groups tout the tactic of buying into heavily shorted stocks. 


 Write to Rob Curran at rob.curran@dowjones.com

(END) Dow Jones Newswires

01-27-21 1744ET