Oof! Shares of GameStop (GME -17.89%) were plummeting 12.7% in morning trading Monday on no news specific to the video game retailer, but it follows the 22% spike in its stock last Friday (it closed up 7% at the end of the day) after it announced it was getting into the non-fungible token (NFT) market in a big way.
Easy come, easy go, but the Dow Jones Industrial Average is tumbling by more than 500 points, and the S&P 500 is giving up 85 points, about a 1.5% loss for both indexes. The markets are reacting to expectations the Federal Reserve will start hiking interest rates as soon as March -- meaning there could be as many as four rate hikes this year -- as inflation continues to spiral higher.
GameStop is looking to build partnerships in the cryptocurrency world and its NFT website is asking creators to participate in its NFT Marketplace. The Wall Street Journal reported it would be launching an NFT exchange for gamers by the end of the year.
Investors have been waiting for more than a year for GameStop to make a definitive announcement about its NFT plans, ever since it began posting job listings looking for a security analyst with experience in blockchain, cryptos, and NFTs. The seeming confirmation it was diving into the space set off a new round of speculation.
While the crypto angle is interesting for GameStop, it still doesn't shed much light on what the retailer will be doing to turn its business around. Investors have been giving chairman Ryan Cohen some slack on getting his ducks in a row in creating the "Amazon of gaming," but he's otherwise been fairly tight-lipped about where he's taking the company, and an NFT exchange doesn't provide clarity.
NFT may be a buzzword these days, but trading NFTs hardly seems to be in GameStop's wheelhouse.