Meme madness, 68 new highs: Superlatives abound in 26% S&P rally this year

HONG KONG (BLOOMBERG) - Superlatives followed one after another in 2021's wild ride for US stock investors. The most all-time highs in 26 years. Triple-digit rallies in some small caps thanks to retail-trader frenzies. A US$1 trillion (S$1.36 trillion) rout after China cracked down on some of its biggest companies.

In a year marked by a waning pandemic, new Covid-19 variants, supply chain disruptions and a fits-and-starts US economic recovery, the S&P 500 smashed old records en route to a 26 per cent gain and the creation of US$8.6 trillion in value. The benchmark's steady march higher has helped push it to a fresh record 68 times this year, the second-most ever, topped only by 1995.

Put another way, the S&P managed a record close on nearly 30 per cent of all trading days in 2021.

Here is a look at some of the other standout moves in stocks this year:

Flush with cash and trapped at home due to the ongoing pandemic, retail traders started the year by supercharging so-called meme stocks. GameStop and AMC Entertainment Holdings were emblematic of the movement as investors flooded social media platforms with calls to buy shares of the struggling companies.

AMC Entertainment has skyrocketed more than 1,200 per cent and GameStop rallied about 700 per cent.

While dozens of other stocks were swept up in the market over the year, many failed to sustain their initial surge. Retail favourites including ContextLogic, Clover Health Investments and Workhorse Group all find themselves down more than 70 per cent this year as investor enthusiasm faded.

The meme craze still paled in comparison with the chaos that ensued following the collapse of Mr Bill Hwang's Archegos Capital Management. A cascade of forced liquidations of positions held by Mr Hwang hammered stocks such as ViacomCBS, Discovery, Vipshop Holdings and Tencent Music Entertainment Group - all of which plunged more than 30 per cent over a week as banks rushed to cover billions of dollars in exposure.

The explosion of special purpose acquisition company (Spac) listings has helped drive initial public offerings on US exchanges to a record. Nearly 1,110 firms made their trading debuts in 2021, raising roughly US$337 billion. Electric pickup maker Rivian Automotive led the way, raising $13.7 billion in November in what was the 12th-biggest IPO of all time across all exchanges, data compiled by Bloomberg shows.

South Korean e-commerce giant Coupang came in second with its US$4.6 billion listing in March. Didi Global rounded out the top three with a US$4.4 billion debut that has since become one of the most disastrous ever.

The shares have plunged 60 per cent amid continued regulatory pressure from China, which culminated with the company announcing earlier this month that it would delist from US exchanges.

Didi's selloff is a microcosm of the rout experienced by US-listed Chinese stocks in 2021 as regulators in Beijing mounted a sweeping crackdown on the nation's companies.

The Nasdaq Golden Dragon China Index has plunged 44 per cent since the start of the year, erasing more than US$1 trillion in market value. Education stocks such as Tal Education Group and New Oriental Education & Technology Group have been the worst hit, with losses in excess of 85 per cent each.