Connect with us
Financial Press
trump’s-tiktok-and-wechat-ban-hurts-chinese-internet-stocks-—-here’s-why-his-executive-order-also-puts-pressure-on-microsoft
trump’s-tiktok-and-wechat-ban-hurts-chinese-internet-stocks-—-here’s-why-his-executive-order-also-puts-pressure-on-microsoft

Breaking

Trump’s TikTok and WeChat ban hurts Chinese internet stocks — here’s why his executive order also puts pressure on Microsoft

A security personnel stands at the entrance of a building at the headquarters of ByteDance, the owner of video-sharing app TikTok, in Beijing.


Getty Images

U.S. President Donald Trump signed two executive orders on Thursday giving American citizens and businesses 45 days to sever any relations with popular Chinese social media and video-sharing platform TikTok, owned by ByteDance, and messaging app WeChat, a unit of gaming and internet conglomerate Tencent Holdings.

– “The spread in the United States of mobile applications developed and owned by companies in the People’s Republic of China (China) continues to threaten the national security, foreign policy, and economy of the United States,” Trump wrote in similar language in both orders.

– The presidential decision puts pressure on Microsoft
MSF,
+1.13%
,
which is engaged in talks with TikTok owner ByteDance to buy the activities of the messaging app in the U.S. and three other countries. Microsoft said earlier this week that it aimed to conclude the discussions by Sept. 15.

– Shares of Tencent
700,
-5.04%

fell 5% on the Hong Kong stock exchange, amid a general fall of Chinese internet companies. The Trump orders came a few days after Secretary of State Mike Pompeo had indicated the U.S. was engaged in a broad campaign against Chinese internet companies.

– “The U.S. is using national security as an excuse and using state power to oppress non-American businesses. That’s just a hegemonic practice,” the Chinese foreign ministry said on Friday, warning that Washington would “bear the consequences” of the presidential edits.

The outlook: Another day, another step in the escalation of tensions between Washington and Beijing, with Trump unlikely to climb down in the final stretch of the U.S. presidential campaign. The two executive orders won’t have the same impact in China: The Chinese government seems to care little about the fate of TikTok, which boasts of 100 million U.S. users every month. But WeChat, while having a much smaller footprint in the U.S. with about one million users, has a massive presence in China and is the app of choice of the Chinese diaspora.

Written By

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Related Articles

Breaking

Last Updated: Sept. 20, 2020 at 4:32 a.m. ET First Published: Sept. 17, 2020 at 5:44 a.m. ET Business closure rates have been highest...

Breaking

Last month, a recently-reopened school district near Atlanta, Ga. told more than 1,000 students and staffers they had to quarantine after a coronavirus outbreak....

Breaking

Published: Sept. 19, 2020 at 1:19 p.m. ET The same order is blocking downloads of WeChat, owned by Tencent Holdings, also based in China...

Breaking

Published: Sept. 16, 2020 at 4:28 p.m. ET This may not be the most challenging moment ever for investors, but there aren’t many good...