Trump-linked SPAC's shares surge as Truth Social app tops Apple downloads

Medha Singh, Reuters

Posted at Feb 23 2022 08:46 AM

The Truth social network logo is seen displayed behind a woman holding a smartphone in this picture illustration taken February 21, 2022. Dado Ruvic, Reuters/Illustration
The Truth social network logo is seen displayed behind a woman holding a smartphone in this picture illustration taken February 21, 2022. Dado Ruvic, Reuters/Illustration

Shares of Digital World Acquisition Corp DWAC.O, the blank-check company behind former US President Donald Trump's new social media venture, Truth Social, rose about 14 percent on Tuesday as the app topped downloads on Apple's App Store after its launch late on Sunday.

Truth Social was downloaded 170,000 times since its launch, according to research firm Apptopia. 

The app's launch could mark Trump's return to social media after he was banned from Twitter Inc, Facebook and Google following an attack on the US Capitol by his supporters last year. 

Digital World's shares jumped 14 percent to $96.36, levels last seen in October, days after the blank check firm announced a deal to publicly list Trump Media & Technology Group (TMTG), the venture behind Truth Social.

The stock was also trending high on investor-focused social media site stocktwits.com, indicating interest from retail traders.

"It's driven by hype but I'm skeptical that the retail driven frenzy can be sustained," said Dennis Dick, head of markets structure, proprietary trader at Bright Trading LLC in Las Vegas.

"From a fundamental perspective, it's too early to tell. Trump has a huge following and they could move from traditional social media to this platform... but it depends on how good the app is."

New users faced trouble signing up for the free app or were placed on a waitlist that cited "massive demand" soon after the launch. It was unclear if the issues were resolved by Tuesday.

Trump Media & Technology Group and Digital World did not immediately respond to Reuters' request for comment.

Wall Street's top financial regulators are investigating Trump's $1.25 billion deal to float TMTG on the stock market, a filing showed in December. 

Other stocks linked to Trump also advanced. Phunware, hired by Trump's 2020 Presidential re-election campaign to build a phone app, climbed 11 percent. SPAC CF Acquisition Corp VI CFVI.O, which is taking video platform Rumble Inc public, added 3.3 percent.

Twitter Inc TWTR.N slipped 1.7 percent, while Facebook-parent Meta Platforms FB.O shed 1 percent.

RELATED VIDEO:

Watch more News on iWantTFC