Shares of Donald Trump’s social media company, Trump Media, continued their upward momentum on Tuesday, following a substantial 26% increase over the previous five trading days.
The stock, which trades under the ticker symbol DJT, gained an additional 2.9% in early trading, pushing the price to $16.55 per share.
This rally marks a significant rebound from its lowest level since the company merged with a special-purpose acquisition company (SPAC) in March.
On September 23, the stock reached a low point, but it has since made a notable recovery.
Stock bounce following lockup expiration
The recent rise in Trump Media’s stock price comes amid concerns about a potential sell-off by insiders, including former President Donald Trump himself.
However, those fears have so far proven to be unfounded. Trump, who publicly stated that he has no plans to reduce his stake in the company, has kept hold of his shares, providing some stability to the stock.
While some early investors did choose to divest, Trump’s decision to retain his holdings may have boosted investor confidence.
Traders who had anticipated a drop in the stock price by engaging in short selling—borrowing shares to sell them at a higher price and repurchasing them at a lower price—may now be contributing to the stock’s rise.
As the stock price has increased, those short sellers are likely buying back the shares to return them, a process known as covering their short positions, which adds further upward pressure to the stock price.
DJT stock movement driven by politics
Despite fluctuations in its stock price, Trump Media, the parent company of the Truth Social platform, often moves independently of traditional business metrics.
Instead, the company’s stock price has been more closely tied to the political fortunes of Donald Trump, especially as the 2024 presidential election draws nearer.
With just weeks to go before the election, polling shows Trump and current Vice President Kamala Harris in a tight race, contributing to the stock’s volatility.
Trump Media’s stock has tended to reflect the ups and downs of Trump’s political chances, with investors closely monitoring his campaign and polling numbers.
As the election nears and public attention on the candidates increases, any shifts in Trump’s standing could continue to affect the stock price.
With the political landscape in a state of flux, market analysts will be watching closely for any developments that could influence the trajectory of the stock.
Vance-Walz debate ahead
Further political intrigue is set to unfold on Tuesday evening when the two nominees for vice president, Republican JD Vance and Democrat Tim Walz, take the stage for a highly anticipated debate.
The outcome of this debate could play a pivotal role in shaping the final stages of the campaign, with potential implications for Trump’s candidacy and, by extension, the stock price of Trump Media.
As the stock of Trump Media continues to rise, much of the momentum seems tied to political factors rather than business fundamentals.
With Trump holding on to his shares and short sellers being forced to cover their positions, the stock has surged in recent days.
As the election approaches and with a key vice-presidential debate on the horizon, it remains to be seen how the stock will respond to the ongoing political developments.
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