Trump Media stock mysteriously plunges

A social media company associated with a former U.S. President experienced a significant drop in stock market value, halting trading momentarily and leaving market participants puzzled. Trading for the company, owner of Truth Social, was bullish during a fluctuating session, with shares around $31. However, at approximately 2:40 p.m. ET, prices fell sharply under $29 amid high trading volumes, causing a brief trading pause initiated by Nasdaq.

After resuming, the stock experienced an initial recovery but subsequently fell beneath $27. The social media platform concluded the day down by 10% and 20% below its high. No new announcements appeared to explain the downturn, though the stock is known for its volatility. Observers suggested technical factors, particularly the failure to exceed the 200-day moving average, led to a selling spree.

The share value had doubled within three weeks amid political speculations influencing market behavior. Some compared the company to other stocks driven by short-term trends, citing trading momentum rather than fundamentals as a key influence. This fluctuation resulted in the company's significant valuation drop, with the stake initially valued at $3.88 billion but decreasing to $3.1 billion.

This marks a recent instance of trading halts for the social media company, although a slight recovery was noted post-market.