(Bloomberg) -- Donald Trump’s plan to run for president is providing a temporary lift to the blank-check firm taking his nascent media company public, as well as other stocks tied to the former president.
Digital World Acquisition Corp (NASDAQ:DWAC), the SPAC merging with Trump Media, rallied as much as 24% in US premarket trading, a small relief for a stock that’s down more than 50% this year. Phunware Inc (NASDAQ:PHUN), a software company that worked on Trump’s 2020 re-election campaign, also jumped as much as 28% and Rumble Inc., the Peter Thiel-backed conservative video network was not trading yet.
The special-purpose acquisition company and firms tied to the former president have been in focus since Trump campaigned with candidates he endorsed for last week’s US midterm elections and signaled his intention to run again.
The stock rallies come after Digital World surged 44% last week, its best performance since the merger was announced in October 2021, as investors speculated over the impact of Trump running for re-election. Digital World’s performance has been tied to the prospect of Trump being successful in 2024, Craig Erlam, senior market analyst at Oanda, said last week.
Digital World has been a favorite among the retail-trading crowd since the tie-up was announced. Despite the recent surge, the stock has slid 58% over the past year through the market close on Nov. 15. Even with those losses, however, it’s the best-performing SPAC and trades at a nearly 150% premium to the cash investors would get back if the deal collapsed.
The stock has been volatile as executives at the SPAC struggle to corral its primarily retail trader base to vote on an extension to the deadline for its merger. The group will hold a meeting on Nov. 22 and must gather the required 65% of shareholders to support the extension or risk delaying the vote for a seventh time.
The SPAC merger has been a lightning rod for politicians as well as regulators. Both the the US Securities and Exchange Commission and Justice Department have launched probes, and the companies have warned in filings that the investigations could derail the planned tie-up.