Stocks Struggle as Trump-Musk Feud Takes Jeffrey Epstein Turn
The richest man in the world and the most powerful man in the world traded accusations that will have market repercussions.
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It looked like it was going to be a relatively quiet day on Thursday while investors awaited the May jobs news, which will be out on Friday. Indices were flat when news hit that President Trump had a phone conversation with Chinese Premier Xi. The initial spike faded fast, but there was another run when further details were announced about future negotiations.
The indices were attempting to stay green when suddenly, a feud between the richest man in the world (Elon Musk) and the most powerful man in the world (Trump) erupted on X. The claims and counter-claims escalated quickly and hit a crescendo when Musk claimed that Trump is listed in the criminal files associated with Jeffrey Epstein, and that is the reason they have not been released.
Tesla TSLA stock was pounded down $47 for a loss of $14, but stocks such as Uber UBER and AST Spacemobile ASTS benefited from speculation that Musk-controlled entities could lose government contracts. The entire market moved lower when Musk made the Epstein claim.
At the end of the day, the losses were fairly mild, with the S&P 500 losing 0.5% and the Russell 2000 ETF IWM actually gaining a fractional amount. Breadth was around 4,000 gainers to 5,700 decliners, but there were over 550 stocks hitting new 12-month highs.
It felt like a bad movie plot as political and business moguls traded insults, but there are likely to be some serious financial repercussions in various places. The triggering event was Musk’s unhappiness with the level of spending in Trump’s proposed "big, beautiful bill," and now we will see if any of the politicians may be emboldened by Musk’s outrage and call for some changes.
The news media will have a field day with this story, but the next big market event will be the jobs report at 8.30 a.m. ET on Friday morning.
Have a good evening. I’ll see you tomorrow.
At the time of publication, DePorre had no positions in any securities mentioned.
