Why has the Lake Resources share price tumbled another 13% on Wednesday?

Why is the Lake Resources share price getting yet another hammering today?

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It’s been another awful day for the Lake Resources N.L. (ASX: LKE) share price so far this Wednesday. Lake Resources shares have shed another 11.86% today and are now going for 88 cents a share. Earlier in today’s trading session, this ASX lithium hopeful got down to lows of 78 cents a share, which represented a loss of more than 13% at the time.

But this latest move is just another extension of the awful trading week Lake Resources shares have endured so far. Monday saw Lake Resources join the S&P/ASX 200 Index (ASX: XJO) for the first time.

But ASX 200 membership wasn’t enough to save the company from a 13.4% drop that day. Yesterday saw the company give up another painful 28.7%, which has been further compounded by today’s near-10% loss so far.

All of these falls translate into a five-day loss of 43.6% for the Lake Resources share price. Ouch.

So what on earth has sparked this precipitous downwards spiral?

Why has the Lake Resources share price lost 43% of its value this week?

Well, it appears that the shock announcement that Lake Resources CEO and managing director, Steve Promnitz, would be leading the company with immediate effect on Monday sparked much of this sell-off.

As my Fool colleague James covered earlier this week, it also appeared that Promnitz may have immediately sold his entire position in the company too, which would amount to just over $12 million (at the time).

Outside of this development, today has seen a sharp selloff of most ASX lithium stocks across the board. ASX lithium shares like Core Lithium Ltd (ASX: CXO) and Sayona Mining Ltd (ASX: SYA) are down by more than 12% and 7% respectively. So it appears Lake Resources has been hit by a powerful double-whammy this week.

No doubt investors will be hoping for a better day tomorrow. But we shall have to wait and see.

At the current Lake Resources share price, this ASX 200 lithium share has a market capitalisation of $1.3 billion.

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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