What Happened?
Shares of latin American e-commerce and fintech company MercadoLibre (NASDAQ: MELI) jumped 5.3% in the afternoon session after Federal Reserve Chair Jerome Powell indicated that interest rate cuts could be on the horizon. Powell's comments, delivered at the Jackson Hole Economic Policy Symposium, sparked widespread optimism among investors. The positive sentiment sent major indexes like the Dow Jones Industrial Average, S&P 500, and the tech-heavy Nasdaq soaring. The rally fueled a rotation into growth and tech stocks, a category that includes the e-commerce and fintech giant.
After the initial pop the shares cooled down to $2,437, up 4.2% from previous close.
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What Is The Market Telling Us
MercadoLibre’s shares are not very volatile and have only had 9 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The previous big move we wrote about was 7 days ago when the stock gained 4.2% on the news that news of significant institutional buying, including a major investment from Michael Burry's Scion Asset Management, bolstered investor confidence. This move was largely driven by a wave of significant institutional investments, signaling strong confidence in the e-commerce giant's future. Notably, Michael Burry's Scion Asset Management purchased a substantial $7.84 billion stake in the company. Other institutional investors also increased their positions, with Ground Swell Capital LLC buying a new stake and GQG Partners boosting its holdings by 23.5%. This investor enthusiasm is backed by the company's strong performance, as it reported a 34% year-over-year revenue surge to $6.8 billion in its second-quarter 2025 results.
MercadoLibre is up 38% since the beginning of the year, and at $2,437 per share, it is trading close to its 52-week high of $2,614 from June 2025. Investors who bought $1,000 worth of MercadoLibre’s shares 5 years ago would now be looking at an investment worth $2,010.
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