DJT shares slide in wild day of trading after Trump found guilty

Former US president owns roughly 64.5% of Trump Media & Technology Group Corp

Donald Trump owns almost two thirds of Trump Media & Technology Group Corp, the parent company of the Truth Social media platform. AFP

Shares of Donald Trump's social media company slid in a rocky day of trading on Friday, a day after the former president was convicted on 34 felony counts in a criminal trial in New York.

Trump Media & Technology Group Corp (DJT) closed at $49.09 a share, down 5.30 per cent on the day. The company's stock fell as much as 7.30 per cent earlier in the day.

Friday's volatile trading followed an equally rocky Thursday, where Trump Media fell as much as 15 per cent in after-hours trading when the 12-person jury convicted Trump.

DJT is the parent company of Truth Social, a social media platform the former president created after he was booted off Twitter, Facebook and Instagram over the Capitol insurrection on January 6, 2021.

A majority of Trump's wealth is tied up in DJT shares, according to the Bloomberg Billionaire Index.

Trump owns 114.75 million shares in the company, or about 65 per cent. That includes 36 million earnout shares that saw his net worth jump $1.2 billion in April.

DJT has a market cap of $8.73 billion, which is controlled mostly by Trump and his supporters.

“As such, one would suppose the volatile reaction in the share price reflects market participants trying to get their heads around the fact that former president Donald Trump was found guilty of all 34 felony counts in his New York criminal trial, and what that might mean for the future of the company,” said Art Hogan, chief market strategist at B Riley Wealth.

“It is almost impossible to accord any rational or fundamental valuation to DJT stock.”

Peter Andersen, chief investment officer and founder of Andersen Capital Management, compared DJT to a betting market.

"I don't think it's trading on any fundamentals, any financial analysis. It's more of a real-time poll of sentiment, similar to the way this the betting markets are. And remember, there's all kinds of twists this narrative can take," Mr Andersen said.

Trump's conviction had a muted effect on major Wall Street indexes, which moved little after Friday's inflation report showed minimal signs of slowing.

Mr Andersen said markets need time to "process news that comes in a shock".

"News markets always have trouble struggling for a short time trying to establish an opinion, and that is going on with this on top of the fact that it is ... a new type of shock that has come to the markets, even though we knew there was going to be a verdict," he said.

The presumptive Republican nominee for the US presidential election was found guilty of falsifying business records to cover up payments made during the 2016 election. He is the first former president to be convicted of a felony.