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Why MOGU Rocketed Higher Today

By Rich Duprey - Aug 18, 2020 at 4:25PM

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The Chinese small cap ended the day up but gave back the biggest part of the gains in the last hour.

What happened

Shares of MOGU (MOGU 2.44%) rocketed 60% higher during trading on Tuesday, though by the market's close it ended up "only" 24% higher.

So what

There was no apparent news that should have triggered the surge, other than the Chinese fashion and lifestyle company's announcement yesterday it would be reporting fiscal first-quarter earnings next week. While investors might be hopeful about what this small-cap stock will report, it's doubtful they're that excited.

Volatility ahead warning sign

Image source: Getty Images.

Now what

Massive spikes in the share price -- and equally large declines -- have been the hallmark of MOGU's stock lately. Most recently, at the end of July, it shot 60% higher on no news again -- only to give back almost all the gains over the next three weeks, before mounting this latest rally.

With the stock oscillating between $2 and $3 a share, investors should be accustomed to the roller-coaster ride MOGU offers. The biggest gains today were once again given back, and it may be another month before it attempts its next big move.


Rich Duprey has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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