Why did Lake Resources stock price drop another 13% on Wednesday?

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It was another horrible day for the Lake NL Resources. (ASX: LKE) share price so far on Wednesday. Shares of Lake Resources are down another 11.86% today and are now selling at 88 cents per share. Earlier in today’s trading session, this ASX lithium hope fell to a low of 78 cents per share, which was a loss of more than 13% at the time.

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

But joining the ASX 200 was not enough to save the company from a 13.4% decline that day. Yesterday the company shed another painful 28.7%, which was further compounded by today’s nearly 10% loss so far.

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

So what triggered this precipitous downward spiral?

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

Well, it seems the shock announcement that Lake Resources CEO and Managing Director Steve Promnitz will lead the company effective immediately on Monday sparked much of that selloff.

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

Apart from this development, today saw a strong sell-off in most ASX lithium stocks across the board. ASX lithium stocks like Core Lithium Ltd (ASX:CXO) and Sayona Mining Ltd (ASX: SYA) are down more than 12% and 7% respectively. So it looks like Lake Resources has been hit with a mighty double whammy this week.

No doubt investors are hoping for a better day tomorrow. But we’ll have to wait and see.

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

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