By Medha Singh and Ananya Mariam Rajesh
(Reuters) – Tesla (NASDAQ:TSLA), prison operators and other notable “Trump trades” were volatile on Tuesday as investors assessed a blitz of executive orders by President Donald Trump within hours of taking the oath of office.
Trump laid out sweeping plans to maximize oil production, curb immigration and impose tariffs as he started his second term as the U.S. president on Monday.
Some “Trump trades”, or bets on what the president will do, rose on Tuesday while others tumbled as investors braced for more volatility under Trump 2.0.
TRUMP MEDIA & TECHNOLOGY GROUP
Shares of Trump Media & Technology Group, parent of the president’s social media and streaming company Truth Social, dropped 11.7% following a strong run-up to the inauguration day. Trump Media shares, widely favored by retail investors to bet on Trump’s presidency, are now facing competition from a newly launched namesake “memecoin”, whose value had soared to more than $15 billion in just a day after launch. “When DJT originally went public, it was one of the only ways to directly play Trump enthusiasm in the markets, but now, especially with the release of $TRUMP and $MELANIA crypto, there are multiple assets investors can put capital into,” said Michael Schulman, chief investment officer at Running Point Capital.
ELON MUSK-LED TESLA
Shares of Tesla fell 2.8%, erasing its premarket gains. The stock has surged 70% since the Nov. 5 presidential election as investors pinned their hopes on CEO Elon Musk’s growing ties with Trump and his role in the new administration to help the automaker.
Musk, who cheered Trump’s return to the White House in a speech during the president’s inauguration on Monday, will lead the Department of Government Efficiency, a panel tasked with finding ways to cut government spending.
ENERGY FIRMS
“We will drill baby, drill,” Trump said on Monday as he laid out a plan to maximize U.S. oil and gas production by declaring a national energy emergency, stripping away excess regulation and withdrawing the U.S. from an international pact to fight climate change. Shares of some major oil firms and top oilfield services companies rose, with Schlumberger (NYSE:SLB) up 1.7% and Kinder Morgan (NYSE:KMI) 2.2%.
NUCLEAR STOCKS
Nuclear energy stocks rose as investors cheered Trump’s pick of Chris Wright for energy secretary. Wright has promised to prioritize the production of nuclear power and liquefied natural gas as part of his plan to boost U.S. energy output.
Vistra gained 4%, NuScale Power rose 10%, while Sam Altman-backed nuclear startup Oklo Inc added 12.4%.
PRISON OPERATORS
Shares of immigration detention center operators GEO Group and CoreCivic (NYSE:CXW) slipped less than 1%, reversing their premarket gains. The stocks posted double-digit gains last year on expectations that Trump’s crackdown on illegal immigration would bring more business.
Trump declared a national emergency at the U.S.-Mexico border and targeting automatic citizenship for U.S.-born children of immigrants in the country illegally.
U.S.-LISTED CHINA STOCKS
American depositary shares of Chinese companies got a boost as Trump held off on imposing heavy tariffs on the world’s second-largest economy in an unexpected move after threatening 60% levies on Chinese goods during his campaigns. Shares of Alibaba (NYSE:BABA) Group Holding gained 0.6%, while the broader iShares MSCI China ETF added 0.4%.
CRYPTO STOCKS
Shares of cryptocurrency and blockchain-related companies slipped as bitcoin’s rally cooled after hitting a record high of $109,071. Trump’s first set of policies made no reference to the asset class.
Crypto exchange Coinbase Global (NASDAQ:COIN) shed 3.6%, while Marathon Digital (NASDAQ:MARA) and MicroStrategy dropped 1.7% and 3.9%, respectively.
