DJT Stock Takes A Nosedive Just Days After Truth Social Goes Live
Former President Donald Trump’s new social media platform Truth Social launched last week to much fanfare, but the parent company behind it has already experienced a major setback. Digital World Acquisition Corp (DWAC) is the special purpose acquisition company (SPAC) that plans to merge with Trump Media & Technology Group, bringing Truth Social to the public markets. However, in its first few days of publicly trading, DWAC’s DJT stock took a nosedive.
When DWAC went public via an initial public offering last Thursday, its DJT stock opened around $10 per share. By Monday, shares had skyrocketed over 300% to a high of $175 apiece as Trump supporters rushed to invest. But the hype did not last long. Starting on Tuesday, DWAC’s DJT stock plunged over 25% by the end of the week. On Friday alone, shares tumbled more than 10% to close at $50.99 each.
What Caused The DJT Stock Crash?
Several factors contributed to DWAC’s DJT stock price decline. Many saw the initial surge as an unsustainable Trump rally rather than real value. Once the fervor died down, investors started taking profits which triggered a selloff. There were also concerns about Truth Social’s long term viability competing against Big Tech giants like Twitter and Facebook. With no financials disclosed yet on Trump’s media venture, some viewed DWAC as overvalued considering the merger is still months away.
It remains to be seen if DWAC can stabilize its DJT stock price in the coming weeks. Much will depend on user growth and engagement on Truth Social. However, the volatile swings so far show Trump’s return to social media is no sure bet on Wall Street. With heightened volatility, DWAC could continue experiencing bumpy DJT stock performance as Trump’s venture gets off the ground.
