Trump Media shares fall 15% as pre-election losses deepen

What it once seemed to be “pre-election euphoria” turned into pre-election bleeding for the media company behind Republican candidate Donald Trump’s right-wing social media platform, Truth Social.

Shares of Trump Media & Technology Group fell nearly 15% at the market open on Thursday. Trading was halted twice in the first hour of the day due to volatility.

Over the past two days, Trump Media has shed billions in market value following a weeks-long rally. Shares closed down 22% on Wednesday, ending the day at $40.03 – their worst day since debuting on the Nasdaq in late March.

The company had a market cap of $6.90 billion as of Thursday morning. Shares of the company are still up 116% this month, holding on to gains from the intense rally of the past few weeks.

While it’s not immediately clear what’s driving the sale, much of DJT’s stock trading has to do with its ties to the former chairman — making him vice president of research at Morningstar (THE MORNING) John Rekenthaler calls “affinity stock,” trading on sentiment rather than actual business performance.

In recent weeks, the action has become something of a proxy for his electoral ratings.

With the US presidential election less than a week away, Trump Media shares have become a way for Trump fans to buy the former president and express their financial support for him.

Trump, who owns a 57 percent stake in the company, said he he has no plans TO get rid of his actionsdespite entering into a six-month share lockout agreement last month. That bodes well for the company — and its stock.

Trump Media itself has said in regulatory filings that its “success depends in part on the popularity of its brand and the reputation and popularity” of Trump, and that “adverse reactions to publicity relating to (Trump) or the loss of its services could adversely affect its revenues and results of TMTG operations.”

Rekenthaler warned, however, that Trump Media’s actions will “go to zero” if the Republican nominee loses the White House once again this election cycle. If Trump were to win, on the other hand, Rekenthaler believes stocks “could do anything.”

For the latest news, Facebook, Twitter and Instagram.