GameStop jumps after hours as Elon Musk tweets out Reddit board that’s hyping stock

Tech

Tesla Motors CEO Elon Musk unveils a new all-wheel-drive version of the Model S car in Hawthorne, California October 9, 2014.

Lucy Nicholson | Reuters

Tesla CEO Elon Musk seemed to rally behind GameStop‘s epic surge, tweeting out a link to the Reddit board that’s largely hyped the stock.

Shares of GameStop were up more than 60% in after-hours trading on Tuesday following Musk’s tweet, which linked to the “wallstreetbets” Reddit page that has more than 2 million subscribers. The Tesla CEO tweeted “Gamestonk!!”

The stock surged earlier in the day after Social Capital’s Chamath Palihapitiya said in a tweet that he bought GameStop call options, betting the stock will go higher. The stock closed up 92.7% on Tuesday.

Musk’s call-outs to certain companies have influenced stock prices before. Earlier Tuesday, he tweeted about a hand-knit wool hat he bought for his dog on Etsy. That sent shares of the company up as much as 8% in premarket trading, though it ultimately closed down 2.1%.

The CEO has faced problems with the SEC for tweeting about Tesla’s stock. In August 2018, he said he wanted to take Tesla private at $420 per share and that he had secured the funding to do so. Musk and Tesla each had to pay the SEC a $20 million fine to settle the suit, and Musk has since agreed to submit his public statements about Tesla’s finances and other topics to vetting by its legal counsel. He infamously tweeted last year that Tesla’s stock was “too high,” sending shares down more than 10% immediately, though they more than rebounded within a week.

The SEC did not immediately respond to a request for comment.

— CNBC’s Lora Kolodny contributed to this report.

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