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MicroStrategy Stock Plunges Amid MSCI Exclusion Fears
21 Nov
Summary
- MicroStrategy stock fell over 11% this week amid index exclusion worries.
- JPMorgan estimates $2.8 billion in forced selling if excluded from MSCI.
- Michael Saylor remains confident despite stock's 39% year-to-date decline.
MicroStrategy's shares have seen a steep decline, plummeting over 11% this week after a substantial 17% drop in the preceding period. This downturn is exacerbated by concerns raised by JPMorgan analysts regarding a potential exclusion from MSCI indexes. Such an exclusion could trigger significant forced selling, with estimates suggesting losses could reach $2.8 billion if the company is removed from major indexes like the MSCI USA and MSCI World.
The broader market sentiment also impacted the stock, which fell over 5% on Thursday. This decline occurred against a backdrop of mixed U.S. jobs data that tempered expectations for interest rate cuts, affecting risk-on assets like cryptocurrencies and equities. The Nasdaq composite and S&P 500 also registered notable drops, while Bitcoin touched its lowest point since April 21.
Despite these financial headwinds and a year-to-date stock drop of nearly 39%, MicroStrategy CEO Michael Saylor remains steadfast in his optimistic stance. He asserts the company is engineered to withstand severe market drawdowns and that its leverage is robust. Saylor also highlighted that MicroStrategy recently acquired an additional 8,178 Bitcoin for $835.6 million, bringing its total holdings to 649,870 BTC.
