Trump Media Stock Plummets 15% Amid Ongoing Sell-Off and Volatile Trading

On Thursday afternoon, the sell-off of Trump Media gained momentum, resulting in a significant drop of approximately 15% in the company's shares. The conservative social media app, Truth Social, represented by DJT on the Nasdaq, was trading at approximately $27.50 per share, marking a stark contrast from its value at the beginning of June, where it stood at over $49 per share. This notable decrease of more than 40% within a month has raised concerns in the market.

Unprecedented Trading Activity

The decline in Trump Media's stock price coincides with an unusual surge in trading volumes. By noon ET on Thursday, over 8.3 million shares had been traded, more than double the average volume. It's remarkable, considering the company's relatively low revenue generation, making this level of trading activity highly uncommon.

Financial Impact on Trump

Former President Donald Trump, who is the majority owner of Trump Media, has been significantly affected by this downturn. His 114,750,000 shares, valued at more than $5.6 billion at the beginning of the month, now stand at around $3.2 billion based on the recent stock movements. This represents a substantial on-paper loss for Trump within a short period.

Factors Amplifying the Decline

The stock's downward trajectory began following a New York jury's conviction of Trump on 34 felony counts of falsifying business records on May 30. This trend accelerated on Tuesday, coinciding with a crucial company deadline related to the Securities and Exchange Commission's anticipated approval of its registration statement. The stock experienced a nearly 10% drop in Tuesday's session, followed by a further decline of more than 17% in post-market trading after the SEC's declaration of the registration statement's effectiveness.

This announcement permitted early investors in Trump Media to exercise their warrants in the company and enabled stockholders to publicly resell securities covered by the registration statement, resulting in a considerable impact on the stock's value.

Following the recent developments, the market has been closely monitoring Trump Media's stock performance. The company's current situation has led to anticipation for updates and further market insights. With the stock market's closure on Wednesday, the impact of these events is yet to fully unfold.