Celebrities wield a lot of cultural influence. But did you know they also have the power to move the market price of a stock using their social currency?
Research from trading platform Stake shows the weird and wonderful ways that celebrities have shifted market sentiment. Let’s take a look at how these figures have changed the fortunes of certain companies.
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Can celebrities really affect the stock market?
There was a lot of chatter during the 2020 Euros about Cristiano Ronaldo’s Coca Cola snub.
Some suggested that his simple act of switching two bottles of Coke for a bottle of water actually wiped $4 billion from Coca Cola’s market cap.
This was later found to be false. But the fact that people believed it could be possible at all shows the potential power celebrities can have on individual shares in a stock market.
When have celebrities moved prices in the stock market?
Although the Ronaldo snub was false reporting, there have been instances where this kind of thing has happened.
Stake has compiled five key moments when celebrities have managed to make or cost a company a lot of money. Let’s take a look at who’s been in the limelight.
1. Colin Kaepernick and Nike
Back in 2018, Nike released an advert featuring this NFL superstar. At the time, Kaepernick was somewhat of a divisive sportsperson.
Nevertheless, the advert proved a hit and Nike’s value rose by an incredible $6 billion (£4.34 billion) during the following month. This meant an all-time high for Nike’s stock price, which was also bolstered by the US Open and the start of the NFL season.
2. Elon Musk and Tesla
During an infamous podcast with Joe Rogan in 2018, Elon Musk smoked weed with his host live on air. This was a big cultural moment and a screenshot of the incident even became a meme with artists painting murals of what took place.
Not everyone found this funny, and it sparked outrage among some investors. The stunt significantly affected Tesla’s position in the market, and the company’s stock price dropped by around 10%. Based on Tesla’s market cap at the time, this was equal to wiping about $5.7 billion (£4.12 billion) from its value.
3. Donald Trump and Boeing
Controlling one of the most popular Twitter accounts in the world, Trump sometimes used his tweets as weapons.
Back in 2016, aerospace manufacturer Boeing was on the receiving end of one of these attacks. The ex-president complained that the company’s shares were overvalued. It was a claim that managed to cut around $3.5 billion (£2.53 billion) from Boeing’s stock market value.
4. Kylie Jenner and Snap
Another example of mind-blowing social media influence occurred when Kylie Jenner sent out a tweet in 2018 claiming she doesn’t really use Snapchat anymore.
As a result, Snap (the company that owns Snapchat) saw its market value tank by $1.3 billion (£940 million).
5. Donald Trump and Toyota
It may not surprise you to see Trump on this list a second time. In 2017, Toyota announced that it would be moving some of its production from the US to Mexico.
The outspoken president wasn’t too happy about this. After publicly voicing his opposition, the stock market value of the Japanese carmaker was driven down by $1.2 billion (£870 million).
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What does this tell us about the stock market?
Lots of things can impact a market. Influential people are always going to affect their surroundings. Sometimes it might be a Midas touch, but in some instances, it can also be the touch of death.
Stake’s Andrew Dengate sums things up nicely: “Whilst Ronaldo may not have wiped $4 billion off the value of Coke last month, the above are just five examples of the influence cultural, sporting and political icons can have on the markets.
“Whether their influence continues to grow and how companies adapt to this is something institutional and retail investors alike are paying close attention to and remains to be seen.”
