Presidential candidate Donald Trump backed Trump Media & Technology Group (NASDAQ:DJT) stock, trading lower Tuesday, following its downward trajectory for this week despite President Joe Biden’s withdrawal of candidature from the 2024 Presidential race.

Trump Media stock experienced a significant surge last week, rising 13% from $31 to $35, primarily attributed to favorable news surrounding Donald Trump. Many believe the stock’s high valuation is closely tied to Trump’s involvement.

Also Read: Musk Could Join Some Silicon Valley Moguls in Funding Trump’s Presidential Bid: Report

However, a stock price primarily driven by popularity poses the risk that the company’s operations may not provide the necessary fundamental support, potentially limiting the expansion of its shareholder base, Forbes reports.

The stock was highly volatile in July 2024 as various reports flagged Donald Trump’s popularity versus Joe Biden, including the debate between the Presidential candidates, during which Biden appeared to be fumbling.

On September 25, all lockup agreements for Trump Media will expire, allowing all shareholders to sell their shares.

Many shares were issued as payment for services or instead of cash debt settlements, raising concerns that the popularity alone may not prevent a sell-off by these shareholders.

The second-quarter earnings report, expected in August, will be crucial.

Price Action: DJT shares were trading lower by 3.03% to $33.65 premarket at the last check on Tuesday.

Also Read: Trump Media Gains as Biden’s Gaffes Raise Campaign Concerns

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This article What's Going On With Trump Media & Technology Stock On Tuesday? originally appeared on Benzinga.com