Rally in Trump-linked stocks fades after social media venture reveals regulatory inquiries (updated)

Remark Holdings

06/12/2021 16:41

(Recasts throughout, updates prices)
    By Bansari Mayur Kamdar
    Dec 6 (Reuters) - Early gains in a handful of companies tied
to former U.S. President Donald Trump's social media venture
fizzled out on Monday after the blank-check firm taking it
public said it had received fact-finding inquiries from
financial regulators.
    Digital World Acquisition  DWAC.O  fell 2.9% after gaining
as much as 22.3% in premarket trading.
    The company said on Monday regulators had sought documents
relating to communications between the blank-check firm and
Trump's social media venture and other details.  urn:newsml:reuters.com:*:nL4N2SR367
    Shares of Digital World and other related stocks had rallied
earlier after Trump's new social media venture said on Saturday
it had raised nearly $1 billion.  urn:newsml:reuters.com:*:nL4N2SR2RW
    SPAC CF Acquisition Corp VI  CFVI.O , which is taking video
platform Rumble Inc public, rose 10.8% after jumping as much as
30% on Monday. Trump joined Rumble's platform in June.
 urn:newsml:reuters.com:*:nL2N2O80DM
    Phunware  PHUN.O , hired by Trump's 2020 Presidential
re-election campaign to build a phone app, fell 2.7%.
    "You're going to continue to find that these rallies are
short lived for the simple reason that we're not in the type of
market environment where people are speculating and taking as
many risks as they were two or three months ago," said Dennis
Dick, a trader at Bright Trading LLC.
    The hype around the Digital World merger in October sent
Phunware and Remark Holdings  MARK.O  in a rally that traders
have compared to this year's meme-stock frenzy.  urn:newsml:reuters.com:*:nL1N2RM2GY
    Remark Holdings has been linked to Trump on social media
forums, but Reuters could not independently verify the link
between Trump and Remark Holdings yet.
    CF Acquisition was the second-most traded stock on the
Nasdaq, with more than 44 million shares traded, while investors
traded 3.7 million and 5.1 million shares of Digital World and
Phunware as of 1536 GMT.
    Both Digital World and CF Acquisition were among the top
trending stocks on investor-focused social media site
Stocktwits.com.

 (Reporting by Bansari Mayur Kamdar and Anisha Sircar in
Bengaluru; Editing by Saumyadeb Chakrabarty and Shounak
Dasgupta)
 ((BansariMayur.Kamdar@thomsonreuters.com))