Trump Media, crypto stocks jump as shooting boosts odds of election victory (updated)

Outdoor Holding

15/07/2024 14:21

(Adds comment in paragraph 6, 7 and 15, adds details on clean
energy stocks reaction in paragraph 12-13 and Reuters/Ipsos
polls in paragraph 14; updates prices)
    By Medha Singh
       July 15 (Reuters) - Crypto stocks, prison operators and
other shares that could benefit from a Donald Trump presidency
jumped premarket on Monday as an assassination attempt on the
Republican candidate boosted odds of his victory in the U.S.
elections. 
    Investors said trades betting on Trump's victory will
increase this week after he was shot in the ear during the rally
in Pennsylvania. The former U.S. president pumped his fist
moments after the attack and his campaign said he was fine.
    Shares of Trump Media & Technology Group (TMTG)  DJT.O 
soared 46%. Trump owns a majority stake in the company, worth
about $3.8 billion as of June 25 according to LSEG data, and it
is the parent of social media platform Truth Social. 
    TMTG stock has surged 75% this year, driven by retail
traders betting on a Trump victory at the Nov. 5 rematch against
Democratic candidate and U.S. President Joe Biden. 
    Crypto stocks also got a boost, tracking bitcoin's  BTC= 
jump to a two-week high, as Trump has presented himself as a
champion of cryptocurrency. Crypto exchange Coinbase Global
 COIN.O , bitcoin miners Riot Platforms Inc  RIOT.O  and
Marathon Digital  MARA.O  added between 5% and 7%.        
    "Investors are becoming more confident of a Trump victory,
and it is starting to be more heavily reflected in certain
sectors," said Rick Meckler, partner at Cherry Lane Investments,
but added that the impact on the overall market was more muted. 
    "Most investors are not changing their overall commitment to
U.S. equities. After all, the broad stock market rose under the
last Trump administration and has risen under the Biden
administration as well."
    Futures tied to the S&P 500  EScv1  edged 0.5% higher. 
    Gun makers and ammunition stocks Smith & Wesson Brands
 SWBI.O , Sturm Ruger & Company  RGR.N  and Ammo  POWW.O  jumped
between 5% and 6.7%. Gun stocks tend to rise after a mass
shooting as calls for gun control in the past have led some
people to buy more firearms out of fear that their availability
would be limited. 
    Prison stocks Geo Group  GEO.N  and CoreCivic  CXW.N  also
rose 6.8% and 7.8%, respectively. Both are potential
beneficiaries of a Trump presidency as he has promised to crack
down on illegal immigration, which could boost demand for
detention centers.
    Software developer Phunware  PHUN.O , hired by Trump's 2020
presidential re-election campaign to build a phone app, jumped
30%, while video-sharing platform Rumble  RUM.O , popular with
conservatives, added 9%.
    On the downside, clean energy stocks slipped as Trump has
said he would reverse many of the Biden administration's
signature climate policies, including tax incentives, if he wins
the election.
        Invesco Solar ETF  TAN.P  fell 4.3% and iShares Global
Clean Energy ETF  ICLN.O  fell 3%.
    U.S. voters view Trump as the better candidate for the
economy, according to Reuters/Ipsos polls, even as Biden's White
House seeks to benefit from a solid economy with inflation
slowing and low unemployment.
        "It is fair to assume that any bump in Trump's approval
rating stemming from this event could dissipate between now and
election day, but we believe Trump's defiance following the
attack could be the defining image of this election cycle," said
Isaac Boltansky, director of policy research at BTIG.

 (Reporting by Medha Singh in Bengaluru, additional reporting by
Pranav Kashyap; Editing by Devika Syamnath)
 ((Medha.Singh@thomsonreuters.com; +91 80 6210 0592; X, formerly
Twitter: @medhasinghs;))