Though the trading week started on Monday, January 13, generally in the red, with all Magnificent 7 stocks opening below their latest close, several companies went against the grain and soared higher.
One of the biggest spikes was evident with Trump Media (NASDAQ: DJT) shares, which soared 9.60% immediately after the morning bell to their press time price of $39.29.
The exact reason behind the surge is unclear as is if the rally will persist or fizzle out akin to the stock’s performance on December 26 and January 6.
Indeed, in late December, DJT shares rallied from lows at $34.71 to a high above $37, and at the start of 2025, they rose from $34.06.
What is clear, however, is that the latest upswing broke the trend that started after the latest Federal Open Market Committee (FOMC) meeting, which led to Trump Media recording a series of lower highs followed by lower lows.
Can the DJT stock rally persist through January?
In 2024, DJT shares became a way to show support to the then-candidate Donald Trump vicariously and even to bet on whether he would get re-elected.
For example, Trump Media stock price entered a long decline once Kamala Harris joined the race and fell all the way to $12 before reversing in late September as the Republican’s odds of victory once again started increasing.
The psychological link between the billionaire’s political success and the company’s market fortunes was solidified by the end of October when DJT peaked above $50. Similarly, the firm’s role as a way to bet on the electoral results was showcased by Trump Media’s decisive decline after November 6.
Still, the unorthodox link between politics and DJT might again be in investors’ favor – and might help both explain and spur on the latest rally. Specifically, Trump media shares might gain substantial upward momentum as January 20 – inauguration day – approaches.
Simultaneously, there remains a strong possibility the current uptick will not lead DJT to new highs as the overall situation in the stock market appears uncertain.
Why DJT stock rally might end as abruptly as it started
Along with the exceptionally high valuation of several leading stocks – primarily those in the technology sector – the inflation and interest rate forecasts have generated substantial uncertainty about what lies ahead for the American economy.
Ultimately, depending on how the upcoming trading days unfold for Magnificent 7 stocks and other major assets like Bitcoin (BTC), DJT’s own volatility might be exacerbated, thus spoiling any hoped-for inauguration rally.