After the Bell: Trump’s electoral victory, ‘animal spirits’ and the record share price of WWE-linked TKO Holdings

The share price of electric vehicle maker Tesla went on an absolute tear after chief executive Elon Musk’s new BFF and First Friend, Donald Trump, won a second term in the White House, but it has cooled a bit since then.

UBS analysts said the share’s post-election rally was a case of “animal spirits”and not rooted in fundamentals, and there may be some truth to that.

But “animal spirits” have been let loose on another share price, and they were probably also unleashed by Trump’s victory.

To wit, the share price of TKO Holdings – which comprises the WWE and UFC – scaled record highs above $139 a share this week. Since Trump’s 2024 election victory, the share price has soared about 16%, which is a pretty hefty gain in the space of just over three weeks.

WWE stands for World Wrestling Entertainment and UFC for Ultimate Fighting Championship. The WWE is as phony as Trump, while the UFC – which stages mixed martial arts bouts – is the real bloody thing.

But it is the WWE that has a long connection to Trump, and this is where one detects the animal spirits behind TKO’s surge.

Trump has picked former WWE president and CEO Linda McMahon to head America’s Department of Education.

Trump probably did not spend much time pondering that pick.

But he has been a WWE fan for decades. In the late 1980s, his Atlantic City Convention Hall would play host to WrestleMania.

“I never sold tickets to anything so easily as I have to this,” Trump was quoted as saying in the documentary WWE: The True Story of WrestleMania.

Trump would subsequently appear at many WWE events and even inserted himself into the storyline in a fake dust-up with Vince McMahon – the husband of the Education Secretary nominee – on the sidelines during a match involving proxies.

The loser would get their head shaved and Trump got to wield the shears.

Over the course of Trump’s astonishing political rise since 2015, several journalists have noted how his act often seems modelled on WWE.

If you are not familiar with it, dear reader, it usually involves convoluted and preposterous storylines – call it “the weave” – and a good guy versus a bad guy who is known as “the heel”.

“The role of a heel is to get ‘heat’, which means spurring the crowd to obstreperous hatred, and generally involves cheating and any other manner of socially unacceptable behaviour,” according to Wikipedia.

Does that sound familiar?

Think of all the name-calling (“Crooked Hillary”, “Cackling Kamala”, “Low-Energy Jeb”), the cheating (on wives, business associates, at golf) and the “socially unacceptable behaviour”, and you get the picture. It’s Trump to a tee.

One of the things that Trump has done at his rallies – which in this election cycle resembled full-on fascist-like displays – is to invert the role of the heel.

He spurs the crowds to “obstreperous hatred” while portraying himself as the good guy who has been cheated by the “deep state” and a stolen election and so on.

It is a raw WWE act – completely fake, but calculated to appeal to a segment of the American public that feeds on the fantasy and rage that such a spectacle provides. It was no surprise that Hulk Hogan made an appearance at the Republican Party’s National Convention this year.

I saw firsthand the warm-up for Trump’s political smackdowns.

Over Christmas 2007 to early January 2008, I covered former Arkansas Governor Mike Huckabee’s run for the Republican presidential nomination during the Iowa caucuses and New Hampshire primary for Reuters.

Martial arts guru and action star Chuck Norris was campaigning for Huckabee, and was a mainstay at his events in an act I dubbed the Huck and Chuck show.

It was often surreal. You would find yourself in a chilly community hall with lots of young guys with baseball hats turned backwards waiting for Chuck to punch through a bunch of bricks with his bare hands or donner someone.

Bantering on the campaign trail, Huckabee would make quips like he wanted a national defence that was “Chuck Norris-approved”, and that sort of thing. His campaign events never had the menace of a Trump rally, but you could see the direction the Republican Party was starting to take.

For example, Huckabee’s proposals were bonkers and included eliminating all income taxes and replacing them with a wildly regressive flat consumptive tax.

This was a policy that caught Norris’ eye and he would say things along the lines of: “The rich Saudi sheiks [his terminology] should pay taxes when they come here and buy luxury yachts.” Which they probably did, but anyway. 

Huck and Chuck also both shared an intense Christian faith and the candidate was all for bringing back school prayer and he was stridently anti-abortion – positions that went down well with the white evangelicals, who are a key base of the Republican Party.

Huckabee did prevail in Iowa – where the evangelical crowd is big in Republican circles – but his campaign tanked from there.

But I’ll bet a lot of the people I saw at those events have since attended Trump rallies with their Maga caps facing front. And Huckabee is now on his way to being the US ambassador to Israel, while his daughter Sarah was Trump’s former press secretary and is currently the governor of Arkansas.

And it was the snake oil salesman and non-devout Trump who would eventually win over the white evangelicals who had been Huckabee supporters.

But an overlooked base of the Republican Party is WWE viewers – who would also find Chuck Norris and his tough-guy image appealing – and they are the antithesis of gin-swilling elite Democrats who prefer documentaries, The Daily Show and jazz.

And in a real contest, their candidate has won the US presidency for a second time.

Tesla’s share price surge may not be based on fundamentals. However, the animal spirits may yet take TKO’s share price to new peaks. DM