Trump, the meme stock
The strength of the performance of equity markets this year has surprised many. Some of the exuberance may be justified, but you don't have to look far to find irrational behaviour.
Every so often in the news business an almost unbelievable story emerges that perfectly captures a moment in time. The sharp rise in shares of Trump Media & Technology Group in the US this week is one of those moments.
The more than 30% surge over two days of trading in the vehicle majority owned and chaired by former US president Donald Trump, which uses the ticker $DJT, has come at a time when equity markets are looking decidedly frothy again. Both the US and Australian benchmarks look set to end the first quarter of the year at fresh record highs despite myriad macro challenges including lingering concerns about the global economic recovery and the most unstable geopolitical environment in decades.
The rise in Trump Media has also arrived just as market participants, government officials and ordinary citizens around the world are nervously casting an eye towards the US general election in November — an election that looks destined to be another white-knuckle ride but which Trump is now, remarkably, favoured in betting markets and polling averages to win.
While Trump’s fortunes in the polls might seem surprising, the fortunes of $DJT on the stockmarket are even more confounding.
