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Mar 31, 2023
Trump-Tied SPAC’s Shares Jump After Historic New York Indictment
(Bloomberg) -- The criminal case against Donald Trump is providing a lift to the blank-check firm taking his media company public, as well as other stocks tied to the former president, as traders bet the news will drive traffic to conservative outlets.
Digital World Acquisition Corp., the special-purpose acquisition company merging with Trump Media, rallied as much as 10%. Meanwhile, Phunware Inc., a software company that worked on Trump’s 2020 reelection campaign, gained as much as 5.6% and Rumble Inc., the Peter Thiel-backed conservative video network, climbed as much as 11% after reporting results.
Trump on Thursday became the first former US president to be indicted. He’s expected to be arraigned as early as Tuesday, according to his defense attorney. Even before the charges were brought, he had been using the Trump Media-owned Truth Social network to rally his supporters in opposition to the investigation, which he’s described as “a political witch hunt.”
Rumble was also getting a boost after reporting record global monthly active users in the fourth quarter, helping the video-sharing platform post quarterly revenue that was nearly double analysts’ average estimates.
“We are impressed by management’s ability to scale its audience and attract more mega influencers on social media quickly, which is a significant accomplishment,” said Tom Forte, an equity research analyst at D.A. Davidson & Co., who has a buy rating on the stock. The analyst said he doesn’t believe the rally is tied to the indictment of Trump.
The Manhattan district attorney’s office has been in contact with Trump’s lawyer to coordinate his surrender for arraignment. Joe Tacopina, Trump’s lawyer, confirmed the former president planned to appear before New York authorities. He said he hasn’t been told what the specific charges are and expects them to remain under seal until the arraignment.
--With assistance from Bailey Lipschultz.
(Updates stock moves, adds comment in penultimate paragraph.)
©2023 Bloomberg L.P.
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