NEW YORK – Stocks were fluctuating on Wednesday morning when Donald Trump shared financial advice via social media, signaling a significant shift in market dynamics.
At 9:37 a.m., he posted "THIS IS A GREAT TIME TO BUY!!! DJT" on his Truth Social platform.
Subsequently, less than four hours later, Trump declared a 90-day suspension of almost all tariffs. Following the announcement, stocks experienced a surge, ultimately climbing 9.5% by the close of trading. The S&P 500 recovered roughly $4 trillion, or 70%, of its losses from the preceding four trading sessions.
The president’s timing was remarkably astute, possibly suspiciously so.
Former White House ethics lawyer Richard Painter, a vocal critic of Trump, commented, "He's enjoying this market control, but he should proceed with caution." Painter pointed out that securities laws prohibit insider trading or aiding others in such activities. "Those who acted on the post's advice made considerable gains."
The core question is whether Trump was considering the tariff pause when he made the initial post.
When questioned about the decision's timing, Trump's response was ambiguous. He stated, "I'd say this morning. I've been contemplating it over the past few days. Fairly early this morning."
In a follow-up email to the White House, a spokesperson didn't directly address the timing issue but defended Trump’s post as part of his presidential duties.
White House spokesman Kush Desai stated, "The President of the United States has a responsibility to reassure the markets and Americans regarding their economic stability amidst relentless media-driven fearmongering."
Another point of interest was Trump's use of his initials as a signoff.
"DJT" also serves as the stock ticker for Trump Media and Technology Group, the parent organization of Truth Social.
It remains unclear if Trump was generally promoting stock purchases or specifically endorsing Trump Media. The White House did not clarify this. Trump occasionally includes "DJT" in his posts to emphasize his personal involvement in the message.
Despite the ambiguity, there was a noticeable influx of investment into Trump Media's stock.
Trump Media's stock closed up by 22.67%, surpassing the broader market's performance by twofold, an impressive achievement for a company that reported a $400 million loss the previous year and seemingly unaffected by tariff-related news.
Trump's 53% stake in the company, held in a trust managed by his son Donald Trump Jr., increased by $415 million on the same day.
Interestingly, another Trump administration-favored stock, Elon Musk’s Tesla, slightly outperformed Trump Media.
Last month, Trump held a press conference outside the White House to praise Tesla and its vehicles. Subsequently, his commerce secretary appeared on Fox TV, recommending viewers to invest in Tesla stock.
Tesla's rise on Wednesday boosted Musk's wealth by $20 billion.
Kathleen Clark, a government ethics law expert at Washington University School of Law, suggested that Trump’s post would have prompted investigations under other administrations, but is unlikely to cause a stir now, aside from potentially increasing Truth Social's user base.
Clark said, "He’s signaling that he can manipulate the market effectively and without consequence. As in: Stay tuned for more stock recommendations."