CNN Business/Julia Horowitz
Where does the GameStop mania end?

From Wall Street to the White House, everyone is watching GameStop shares.

What’s happening: Stock in the left-for-dead video game retailer shot up an astonishing 135% to $347.51 on Wednesday, bringing gains since the start of January to 1,745%. In the battle between day traders coordinating on Reddit and legacy hedge funds betting GameStop shares will crash, the rag-tag internet crew is winning the day — at least for now.

It’s not just about GameStop (GME) anymore. Shares of AMC Entertainment (AMC), Nokia (NOK), Tootsie Roll Industries (TR) and the shell of a bankrupt Blockbuster also soared Wednesday as emboldened small investors looked further afield.

Earlier this week, I wrote about how the spectacle has grabbed Wall Street’s attention, forcing the old guard to reckon with how the democratization of investing through no-fee trading platforms like Robinhood is affecting market dynamics. There’s plenty more to be said on that front. But for now, there’s one big question: Just how does this episode end?

Shares of companies like GameStop and AMC Entertainment remain extremely volatile in premarket trading, leaving the immediate fate of the rally unclear. As of 7:35 a.m. ET, GameStop shares were up 37% to $475.

Outside of the United States, where stock in popular hedge-fund targets like Unibail-Rodamco-Westfield had also shot up, there were signs Thursday morning of retrenchment. Shares of the European shopping center owner shed almost 2% in Amsterdam on Thursday after gaining nearly 20% the previous session.

For the hedge funds and short sellers at the center of the melee, though, the damage is done. Melvin Capital closed out its position in GameStop this week after taking a huge loss, CNBC reports. Andrew Left of Citron Research said in a YouTube video posted Wednesday that he covered most of his GameStop shorts at “a loss of 100%.”

Watch this space: So far, many on Wall Street are viewing the GameStop saga as a somewhat isolated event. But there are some concerns that damaged Wall Street money managers may need to sell other stocks they’d been planning to hold for the long-term — say in Apple, or Target — in order to cover losses. That could ripple through the broader market, which on Wednesday had its worst day since October thanks to concerns about Covid-19 vaccination efforts and the economy.

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Kitco/Anna Golubova
Gold to still hit $2,300 in 2021, but silver and platinum to outperform — MKS

All precious metals will see solid gains this year, but the likeliest best performers will be silver, followed by platinum and gold, said Frederic Panizzutti, managing director at MKS.

Despite a slower start to the year, gold is still on track to hit new all-time highs, Panizzutti told Kitco News last week.

“We expect gold to perform well. Gold to reach new highs at $2,300. All in, platinum, silver, and gold would be the top three performers,” he said. “Both silver and platinum have been lagging. This gap could attract some investment and speculative interest”.

Gold and silver’s gains will come irrespectively of the timing of the economic recovery.

“Silver has some catching up to do, and gold is in a perfect storm due to environment and appetite for diversification,” Panizzutti pointed out. “In the first half of the year, we expect silver to rise on the back of gold-silver ratio, which would result in speculative silver buying. Silver was in the shadow of gold, but we didn’t take full upside gain.”

Platinum and silver will also benefit from the recovering industrial demand this year.

“In the second half of the year, silver and platinum will advance on the back of increasing industrial demand, especially in Asia,” Panizzutti added.

Gold will see some repositioning in the market after U.S. President Joe Biden’s inauguration, which should benefit prices.

“The world was uncertain until the last minute. Investors liquidated positions and have been on the cautious side,” Panizzutti described. “The fact that the U.S. election has come to an end, the market will be able to concentrate on other factors like the fundamentals.”

Also, an economic slowdown in the U.S. during the first quarter mixed in with the likely lower corporate earnings results from 2020 and faster economic recovery elsewhere in the world could trigger a weaker U.S. dollar.

“We see outflows out of U.S. dollars and into regions where growth picks up sooner,” Panizzutti said.

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CNBC/Emily DeCiccio
New Covid variants are going to ‘hit us pretty hard,’ says Dr. Peter Hotez

Dr. Peter Hotez, co-director of the Center for Vaccine Development at Texas Children’s Hospital, says that the U.S. is “in for a tough ride” as new Covid variants spread across the country. 

“Because they’re more transmissible, it means more Americans will become infected, so even though we’ve had a slight decrease in the number of new cases … the expectation now, it’s going to go back up because of these new variants,” said Hotez in a Thursday evening interview on “The News with Shepard Smith.” “More people are going to get infected, start overwhelming hospital systems again, and possibly the death rate will start to go up, both from a combination of more new cases in general and also they may have slightly higher mortality rates just from the variant just by the nature of the variant.”

Health officials in South Carolina confirmed two cases of the dangerous, highly transmissible South African strain of Covid. The officials said the cases do not appear to be connected and are not linked to any recent travel. Dr. Zeke Emanuel, a member of President Joe Biden’s Covid Advisory Board, said that’s why the South African strain is so concerning. 

“This is worrisome because these two individuals have no evidence of travel, and so it does mean that the variant from South Africa, which is more worrisome than even the British variant, is about and in the community,” said Emanuel.  

Hotez told host Shep Smith that the new strains are even more problematic because “we haven’t been looking.” 

“We’ve been so profoundly underperforming in genomic sequencing, which is how we pick up these U.K, South African, Brazilian variants, so we know they’re in South Carolina, but they could be elsewhere,” said the dean of the National School of Tropical Medicine at Baylor College of Medicine.

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