NEW YORK CITY, AP – The erratic trading in shares of underdog companies such as GameStop that turned markets combustible last week appears to have migrated to commodities, sending silver prices surging to an eight-year high.

Silver futures jumped more than nine per cent on Monday to $US29.42 an ounce with #silversqueeze trending on Twitter. That exuberance spread to companies that mine precious metals, especially silver.

Shares of Pan American Silver surged more than nine per cent, First Majestic Silver rose 18.7 per cent, Hecla Mining spiked 21.8 per cent, and Coeur Mining soared 17.6 per cent.

Some analysts called price jump the latest assault by the smaller investors who sent GameStop soaring recently. But many of those same traders instead called it a trap set by hedge funds to divert their attention away from GameStop.

An online army of Reddit traders banded together for the past week to snap up thousands of shares of GameStop, AMC and other struggling chains, stocks that have been heavily shorted (bets that the stock will fall) by hedge funds. In the process, they have done heavy damage to those funds in a stunning reversal of financial power on Wall Street.

Some of these smaller traders believe the hedge funds that were pillaged last week are behind the surge in silver. Communications on messaging boards claim hedge funds have become active on Reddit anonymously, attempting to drive them out of GameStop bets and into silver but only after hedge funds had taken huge positions.

Meanwhile, GameStop shares dropped 32 per cent to $US225 on Monday but the price has been tremendously volatile of late. Last week a 44 per cent drop on Thursday was followed by a 68 per cent jump on Friday.

The number of GameStop shares that have been shorted (bets that the stock will fall) were slashed by more than half in recent days, according to a report by analytics firm S3 Partners.

Last week’s turmoil caused hedge funds to pull back on their investments by the sharpest degree since February 2009, during the financial crisis, according to Goldman Sachs.

It says hedge funds have been getting out of both short sales and more traditional investments that bank on rising prices “in every sector”.

The narrative has burst from financial pages, with President Joe Biden and Treasury Secretary Janet Yellen peppered with questions about it last week.

The story has also moved out of Reddit chatrooms and into places where silver actually trades hands, with dealers from the United States to Singapore scrambling for bars and coins to meet demand.